Is Gentherm, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Gentherm, Inc. has moved from fair to very expensive, indicating a shift towards overvaluation. The company appears to be overvalued based on its P/E ratio of 12, which is significantly lower than its peer average of approximately 25.79, and its EV to EBITDA ratio of 5.36, which also lags behind peers like Donaldson Co., Inc. at 18.30. Additionally, Gentherm's Price to Book Value stands at 1.29, suggesting a premium over its book value that may not be justified given its performance metrics.
In comparison to its peers, Gentherm's valuation ratios indicate a less favorable position, particularly when contrasted with Allison Transmission Holdings, Inc., which has a P/E of 9.98 and is rated as attractive. The recent stock performance shows that Gentherm has underperformed relative to the S&P 500, with a year-to-date return of -14.51% compared to the S&P 500's 13.30%, reinforcing the notion that the stock may be overvalued in the current market environment.