Is Invesco Mortgage Capital, Inc. overvalued or undervalued?

As of 20 February 2025, the valuation grade for Invesco Mortgage Capital, Inc. has moved from does not qualify to very attractive. The company is currently undervalued based on its financial metrics. The P/E ratio stands at 10, significantly lower than the industry average, while the Price to Book Value is at 0.66, indicating a strong discount relative to its book value. Additionally, the PEG ratio is exceptionally low at 0.02, suggesting that the stock is undervalued relative to its growth prospects.
In comparison to its peers, Invesco Mortgage Capital's P/E ratio of 9.82 is lower than that of Gladstone Commercial Corp., which has a P/E of 21.36, and TPG RE Finance Trust, Inc. at 9.06. The EV to EBITDA ratio for Invesco is 1.08, comparable to its peers, but still reflects a favorable valuation position. Despite recent stock performance trailing the S&P 500 over the past year, the current valuation metrics indicate that Invesco Mortgage Capital presents a compelling investment opportunity at this time.