Is First Busey Corp. overvalued or undervalued?

As of 23 January 2024, the valuation grade for First Busey Corp. has moved from very attractive to expensive, indicating a shift towards overvaluation. The company appears overvalued based on its current metrics, with a P/E ratio of 36, significantly higher than peers like First Commonwealth Financial Corp. at 15.48 and Stock Yards Bancorp, Inc. at 18.22. Additionally, its Price to Book Value stands at 0.96, suggesting it is trading close to its book value, while the EV to EBITDA ratio of 13.90 further emphasizes the premium being paid for its earnings.
In terms of performance, First Busey Corp. has shown mixed results against the S&P 500, with a year-to-date return of 6.66%, lagging behind the index's 12.22%. Over the longer term, the company has underperformed significantly, with a 1-year return of -6.02% compared to the S&P 500's 17.14%, and a 3-year return of 7.16% versus 70.41% for the index. This underperformance, combined with its high valuation ratios, reinforces the conclusion that First Busey Corp. is currently overvalued.