Is Kezar Life Sciences, Inc. overvalued or undervalued?

As of 12 November 2024, the valuation grade for Kezar Life Sciences, Inc. has moved from risky to does not qualify, indicating a significant deterioration in its financial standing. The company is currently assessed as overvalued given its financial metrics, including a Price to Book Value of 0.31 and an EV to EBITDA ratio of 0.85. The negative ROE of -74.87% further underscores the challenges the company faces in generating returns for its shareholders.
In comparison to peers, Kezar Life Sciences, Inc. shows a less favorable position relative to CARA Therapeutics, Inc., which has a P/E ratio of -6.235, and Kodiak Sciences, Inc., also marked as does not qualify with a P/E of -0.9925. The company's recent stock performance has been underwhelming, with a year-to-date return of -36.61%, contrasting sharply with the S&P 500's gain of 2.44% over the same period. Overall, the combination of poor financial ratios and relative underperformance suggests that Kezar Life Sciences, Inc. is overvalued in the current market landscape.