Is Howard Hotels overvalued or undervalued?

As of 12 June 2025, the valuation grade for Howard Hotels has moved from fair to expensive, indicating a shift in perception regarding its market value. The company is currently deemed overvalued based on its financial ratios, with a PE ratio of 22.66, an EV to EBITDA of 15.16, and a ROE of 4.55%. These figures suggest that the stock may not be justified at its current price level.
In comparison to its peers, Howard Hotels stands out with a significantly lower PE ratio than Indian Hotels Co, which has a PE of 63.96, and ITC Hotels at 63.44. Despite this, the overall valuation of Howard Hotels remains high relative to the industry, as indicated by its EV to EBIT of 27.28. Recent performance shows that while Howard Hotels has outperformed the Sensex over a three-year period with a return of 298.56%, it has lagged behind in the year-to-date comparison, with a decline of 9.46% versus the Sensex's gain of 4.55%.