Is Gyre Therapeutics, Inc. overvalued or undervalued?

As of 9 May 2025, the valuation grade for Gyre Therapeutics, Inc. has moved from fair to expensive, indicating that the company is overvalued. The P/E ratio stands at 105.51, significantly higher than the industry average, while the EV to EBITDA ratio is 57.93, further suggesting a premium valuation. The lack of a PEG ratio indicates that growth expectations may not justify the current price levels.
In comparison to peers, Gyre Therapeutics is notably more expensive, with its P/E ratio far exceeding typical valuations in the pharmaceuticals and biotechnology sector. For instance, while Gyre's P/E is 105.51, other companies in the industry may have much lower ratios, reflecting a more reasonable valuation. Additionally, the company's stock has underperformed against the S&P 500, with a year-to-date return of -36.45% compared to the S&P 500's 12.22%, reinforcing the notion that the stock may be overvalued given its performance trajectory.