Is LCI Industries overvalued or undervalued?

As of 8 September 2025, LCI Industries has moved from a fair to very attractive valuation grade. The company appears undervalued, particularly when considering its P/E ratio of 16, which is significantly lower than the peer average of 27.44 for Advanced Drainage Systems, Inc. and 38.75 for Armstrong World Industries, Inc. Additionally, LCI's EV to EBITDA stands at 8.97, compared to the peer average of 15.19, and its PEG ratio is an impressive 0.22, indicating strong growth potential relative to its price.
Despite these favorable valuation metrics, LCI Industries has underperformed compared to the S&P 500, with a year-to-date return of -4.11% versus the S&P 500's 12.22%. This trend continues over longer periods, with a 3-year return of -11.28% compared to the S&P 500's 70.41%. Overall, LCI Industries presents a compelling investment opportunity given its attractive valuation ratios and growth potential, despite recent stock performance challenges.