Is Kimball Electronics, Inc. overvalued or undervalued?

As of 31 October 2025, the valuation grade for Kimball Electronics, Inc. moved from fair to very expensive. The company appears overvalued based on its current metrics, including a P/E ratio of 20, which is significantly lower than the peer average of approximately 34.66, and an EV to EBITDA ratio of 6.83 compared to the peer average of 9.82. Additionally, the Price to Book Value stands at 0.97, indicating that the stock is trading close to its book value, which is not typical for a company with such a high valuation grade.
In comparison to its peers, Kimball Electronics shows a lower ROE of 4.76% and a ROCE of 8.79%, which further supports the notion that it is overvalued relative to its industry. Despite a strong year-to-date return of 55.23% compared to the S&P 500's 16.30%, the long-term performance shows a stark contrast, with a 3-year return of 40.66% against the S&P 500's 76.66%, highlighting potential concerns about sustainability at its current valuation.