Is Granite Construction, Inc. overvalued or undervalued?

As of 17 October 2025, Granite Construction, Inc. has moved from a fair to an expensive valuation grade. The company appears to be overvalued, with a P/E ratio of 25, which is significantly higher than the industry average, and an EV to EBITDA ratio of 21.59, indicating a premium valuation compared to peers like MasTec, Inc. with a P/E of 57.22 and Sterling Infrastructure, Inc. at a fair valuation with a P/E of 28.27. Additionally, the PEG ratio of 0.23 suggests that the stock may not be justified at its current price given its growth prospects.
Despite the overvaluation, Granite Construction has shown strong performance with a year-to-date return of 19.75%, outperforming the S&P 500's 13.30% during the same period. However, in the short term, the stock has declined by 0.36% over the past week, contrasting with the S&P 500's gain of 1.70%. Overall, the company's high valuation ratios and recent performance indicate that it is currently overvalued.