Is Flanigan's Enterprises, Inc. overvalued or undervalued?

As of 12 August 2025, Flanigan's Enterprises, Inc. has moved from a very expensive to an expensive valuation grade. The company is currently considered overvalued based on its valuation metrics. Key ratios include a P/E ratio of 23, a Price to Book Value of 2.18, and an EV to EBITDA of 9.61, which are higher than the peer average of 17.62 for P/E and 8.15 for EV to EBITDA, indicating that Flanigan's is priced at a premium compared to its peers.
In comparison to its industry, Flanigan's valuation appears less favorable than that of Potbelly Corp., which has a P/E of 40.09, and Nathan's Famous, Inc., with a P/E of 41.50. Despite a strong YTD return of 25.66% compared to the S&P 500's 12.22%, the significant underperformance over longer periods, such as the 3-year and 5-year returns, suggests that the stock may not sustain its current valuation levels.