Is Journey Medical Corp. overvalued or undervalued?
As of November 12, 2024, Journey Medical Corp. is considered a risky investment due to its overvaluation and poor financial metrics, including a Price to Book Value of 7.99 and a negative EV to EBITDA ratio of -22.82, despite a strong year-to-date return of 85.93%.
As of 12 November 2024, the valuation grade for Journey Medical Corp. has moved from fair to risky, indicating a deteriorating outlook. The company appears to be overvalued given its negative financial metrics, including a Price to Book Value of 7.99 and a troubling EV to EBITDA ratio of -22.82. Additionally, the Return on Capital Employed (ROCE) stands at -44.88%, reflecting significant inefficiencies in generating returns from capital investments.In comparison to peers, Journey Medical Corp.'s valuation ratios are less favorable; for instance, Fortress Biotech, Inc. has a more manageable EV to EBITDA of -0.87, while Sol-Gel Technologies Ltd. shows an EV to EBITDA of -11.11. Despite the company's strong year-to-date return of 85.93% compared to the S&P 500's 12.22%, the overall financial health suggests that the stock is not a sound investment at its current price of 7.27.
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