Is InterDigital, Inc. overvalued or undervalued?

As of 6 February 2025, the valuation grade for InterDigital, Inc. has moved from attractive to very attractive, indicating a significant improvement in its perceived value. The company is currently considered undervalued. Key ratios include a P/E ratio of 39, a PEG ratio of 0.37, and a remarkable ROCE of 91.09%, which highlight its strong profitability and growth potential.
In comparison to peers, InterDigital's P/E ratio of 37.84 is lower than Ubiquiti, Inc.'s 41.78, suggesting it is more attractively priced relative to its earnings. Additionally, Ciena Corp. is categorized as very expensive with a P/E of 96.72, further emphasizing InterDigital's favorable valuation. Notably, the company's stock has outperformed the S&P 500 significantly over the past year, returning 97.70% compared to the index's 10.26%, reinforcing the attractiveness of its current valuation.