Is Fabrinet overvalued or undervalued?

As of 14 November 2025, the valuation grade for Fabrinet has moved from very attractive to attractive, indicating a shift in its perceived value. Based on the current metrics, Fabrinet appears to be overvalued, particularly when compared to its peers. The company's P/E ratio stands at 27, while its EV to EBITDA ratio is 21.90, and the PEG ratio is 1.20, suggesting that its valuation may not be justified given its growth prospects.
In comparison to its peers, Fabrinet's P/E ratio is significantly higher than that of Skyworks Solutions, which is at 20.61, and Rambus, which has a P/E of 34.99. This indicates that while Fabrinet is positioned attractively within the market, it may be overvalued relative to its peers. Notably, Fabrinet has delivered impressive returns, with a YTD return of 89.49% compared to the S&P 500's 14.49%, reinforcing the notion that while the stock has performed well, its current valuation may not be sustainable.