Is Gentherm, Inc. overvalued or undervalued?

As of 30 October 2024, the valuation grade for Gentherm, Inc. has moved from expensive to very expensive, indicating a significant shift in its perceived value. The company is currently considered overvalued. Key ratios include a P/E ratio of 12, an EV to EBITDA of 5.36, and a Price to Book Value of 1.29.
When compared to peers, Gentherm's P/E ratio of 11.93 is notably higher than Garrett Motion, Inc. at 7.23 and Adient plc at 8.68, both of which are also categorized as risky. Furthermore, Gentherm's ROCE stands at 16.40%, which is commendable, yet its overall valuation metrics suggest that the stock is trading at a premium relative to its earnings potential. Recent stock performance reflects a decline, with a year-to-date return of -29.97%, contrasting with the S&P 500's positive return of 2.44%, reinforcing the notion of overvaluation.