Is Global Water Resources, Inc. overvalued or undervalued?

As of 6 March 2024, the valuation grade for Global Water Resources, Inc. has moved from expensive to very expensive. The company appears to be overvalued based on its current financial metrics. Key ratios include a P/E ratio of 50, a price-to-book value of 3.66, and an EV to EBITDA of 16.48, all of which are significantly higher than its peers. For instance, Middlesex Water Co. has a P/E of 23.09 and an EV to EBITDA of 16.34, while Select Water Solutions, Inc. shows a P/E of 23.63 and an EV to EBITDA of 5.91, indicating that Global Water Resources, Inc. is trading at a premium compared to these competitors.
Additionally, the company's return metrics indicate underperformance relative to the S&P 500, with a year-to-date return of -6.35% compared to the index's 2.44%. Given these factors, including the high valuation ratios and poor stock performance relative to broader market indices, Global Water Resources, Inc. is assessed as overvalued.