Is Insteel Industries, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Insteel Industries, Inc. has moved from very attractive to attractive, indicating a shift in perception of its worth. The company appears to be overvalued based on its current metrics, with a P/E ratio of 29, significantly higher than the peer average of approximately 22.8. Additionally, the EV to EBITDA ratio stands at 15.04, while peers like Park-Ohio Holdings Corp. show a more favorable ratio of 8.79, suggesting that Insteel may be priced too high relative to its earnings potential.
In terms of returns, Insteel Industries has underperformed compared to the S&P 500 over the 1-year and 3-year periods, with returns of 10.02% and 10.14%, respectively, compared to 14.08% and 81.19% for the index. This underperformance reinforces the notion that the stock may be overvalued, especially given its high valuation ratios compared to peers like Olympic Steel, Inc. and CompX International, Inc., which have lower P/E and EV/EBITDA ratios.