Is Erie Indemnity Co. overvalued or undervalued?

As of 27 June 2025, the valuation grade for Erie Indemnity Co. has moved from very expensive to expensive. The company is currently considered overvalued. Key ratios include a P/E ratio of 41, a Price to Book Value of 12.35, and an EV to EBIT of 36.50. In comparison, Berkshire Hathaway has a P/E of 21.31, while Chubb Ltd. has a P/E of 17.74, highlighting the premium at which Erie Indemnity is trading relative to its peers.
Despite a high ROCE of 39.39% and a robust ROE of 29.80%, the company's valuation metrics suggest it is priced significantly above its fair value. Recent stock performance has been underwhelming, with a year-to-date return of -17.41%, contrasting sharply with the S&P 500's positive return of 4.96% over the same period, reinforcing the notion that the stock may be overvalued.