Is Gulf Island Fabrication, Inc. overvalued or undervalued?

As of 5 May 2025, Gulf Island Fabrication, Inc. has moved from an attractive to a very attractive valuation grade. The company is currently undervalued, with a P/E ratio of 9, significantly lower than its peers such as Insteel Industries, Inc. with a P/E of 28.50 and Olympic Steel, Inc. at 21.03. Additionally, Gulf Island's EV to EBITDA ratio stands at 4.08, which is more favorable compared to Xometry, Inc. that has a negative EV to EBITDA ratio of -48.58.
The company's financial metrics further support this undervaluation, with a Price to Book Value of 1.12 and a PEG ratio of just 0.06, indicating strong growth potential relative to its price. Notably, Gulf Island's ROCE is 20.22% and ROE is 12.64%, showcasing effective capital utilization and profitability. Despite a recent dip in stock price, the company has outperformed the S&P 500 over the past three years, reinforcing its attractive valuation in the current market environment.