Is Koss Corp. overvalued or undervalued?

As of 26 October 2023, Koss Corp. has moved from a fair to a risky valuation grade, indicating a significant deterioration in its financial outlook. The company is currently considered overvalued given its negative earnings metrics, including a P/E ratio that is not applicable due to losses, an EV to EBITDA of -28.84, and a ROE of -2.45%. The current price of $5.00 is notably below its 52-week high of $18.73, reflecting a challenging market position.
In comparison to its peers, Koss Corp. exhibits a stark contrast with IMAX Corp., which has a P/E of 37.68, and Turtle Beach Corp., with a P/E of 14.04. The negative EV to EBIT ratio of -24.87 further emphasizes the company's struggles relative to its industry. Despite a recent one-week stock return of 2.04%, the year-to-date performance shows a decline of 32.25%, reinforcing the assessment that Koss Corp. is currently overvalued in the market.