Is Fabrinet overvalued or undervalued?

As of 14 November 2025, the valuation grade for Fabrinet has moved from very attractive to attractive. The company appears to be overvalued based on its current metrics, with a P/E ratio of 27, a Price to Book Value of 4.66, and an EV to EBITDA of 21.90. In comparison to peers, Skyworks Solutions has a P/E of 20.61 and an EV to EBITDA of 10.27, while Rambus, Inc. shows a P/E of 34.99 and an EV to EBITDA of 26.99, indicating that Fabrinet's valuation is on the higher end relative to its industry.
Despite the overvaluation, Fabrinet has demonstrated strong performance, with a year-to-date return of 87.98% compared to the S&P 500's 14.49%, and a remarkable 5-year return of 492.40% against the S&P 500's 87.83%. This performance highlights the company's growth potential, although its current valuation metrics suggest caution for new investors.