Is Hippo Holdings, Inc. overvalued or undervalued?

As of 9 August 2021, the valuation grade for Hippo Holdings, Inc. has moved from does not qualify to risky, indicating a heightened level of concern regarding its financial stability and performance. The company appears to be overvalued given its current metrics, particularly with a P/E ratio that is not applicable due to losses, a Price to Book Value of 2.16, and an EV to EBITDA ratio of 13.07, which suggests a premium valuation despite negative earnings.
In comparison to its peers, Hippo Holdings, Inc. has a significantly higher EV to EBITDA ratio than Crawford & Co. at 3.81 and GoHealth, Inc. at 0.36, both of which are more attractively valued. Additionally, Hippo's ROE stands at -16.26%, further illustrating its struggles in generating returns for shareholders. While the company has shown strong returns over the past year at 78.28% compared to the S&P 500's 10.26%, this performance may not be sustainable given its current financial challenges, reinforcing the view that it is overvalued in the market.