Is Flexsteel Industries, Inc. overvalued or undervalued?

As of 10 October 2025, the valuation grade for Flexsteel Industries, Inc. has moved from fair to expensive, indicating a shift towards overvaluation. The company appears overvalued based on its P/E ratio of 7, which is significantly lower than the industry average, and an EV to EBITDA ratio of 6.29, also below the peer average. Additionally, the PEG ratio stands at a low 0.12, suggesting that the stock may not be justifying its price relative to its growth prospects.
In comparison to its peers, Flexsteel Industries, Inc. has a P/E ratio of 9.47, while Ethan Allen Interiors, Inc. shows a much higher P/E of 28.41, indicating that Flexsteel is trading at a discount relative to some competitors. Other peers like Arhaus, Inc. have an EV to EBITDA of 8.19, further emphasizing Flexsteel's relative valuation. Over the past year, Flexsteel has returned 0.86%, underperforming the S&P 500's 13.36%, which reinforces the notion that the stock may be overvalued given its recent performance.