Is Hennessy Advisors, Inc. overvalued or undervalued?

As of 31 October 2025, the valuation grade for Hennessy Advisors, Inc. moved from attractive to very attractive. The company appears to be undervalued based on its valuation ratios, including a P/E ratio of 9, a Price to Book Value of 0.90, and an EV to EBITDA of 1.38. In comparison to peers, Medallion Financial Corp. has a P/E of 6.39, while Monroe Capital Corp. stands out with a significantly higher P/E of 85.47, indicating that Hennessy Advisors may offer better value relative to its earnings potential.
Despite recent stock performance showing a decline of 23.06% year-to-date compared to a 16.30% gain in the S&P 500, the long-term outlook remains positive, with a 5-year return of 21.56% versus 109.18% for the benchmark. This suggests that while the stock has faced short-term challenges, its valuation metrics indicate it is positioned favorably for future growth.