Is First Foundation, Inc. overvalued or undervalued?

As of 29 October 2024, the valuation grade for First Foundation, Inc. has moved from fair to risky, indicating a deterioration in its financial standing. The company is considered overvalued based on its current metrics, particularly given its Price to Book Value of 0.41 and EV to EBITDA of 0.66, which are significantly lower than those of its peers. For instance, Five Star Bancorp has a fair valuation with a P/E of 13.58, while SmartFinancial, Inc. is attractive with an EV to EBITDA of 15.30, highlighting the relative weakness of First Foundation.
The company's negative returns further reinforce this overvaluation narrative, as it has underperformed the S&P 500 across multiple time frames, including a staggering -69.20% over three years compared to the index's 70.41% gain. With a current price of 5.96, the stock's performance and ratios suggest it is not positioned favorably in the market.