Is Flexsteel Industries, Inc. overvalued or undervalued?

As of 17 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 peer average of approximately 9.47 for similar companies, and an EV to EBITDA ratio of 6.29, also below the industry benchmarks. Additionally, the PEG ratio stands at 0.12, suggesting that the stock may not be priced appropriately relative to its growth prospects.
In comparison to its peers, Ethan Allen Interiors, Inc. has a much higher P/E ratio of 28.41, indicating a more favorable valuation, while Bassett Furniture Industries, Inc. is considered fair with a P/E of 35.27. Notably, Flexsteel's recent stock performance has lagged behind the S&P 500, with a year-to-date return of -29.21% compared to the index's 13.30%, highlighting the challenges the company faces in the current market environment.