Is Lifeway Foods, Inc. overvalued or undervalued?

As of 13 May 2025, the valuation grade for Lifeway Foods, Inc. moved from very expensive to expensive. The company is currently considered overvalued. Key ratios include a P/E ratio of 42, an EV to EBITDA of 26.34, and a Price to Book Value of 5.73. In comparison, Seneca Foods Corp. has a P/E of 22.78 and an EV to EBITDA of 10.22, while John B. Sanfilippo & Son, Inc. stands out with an attractive P/E of 13.33 and an EV to EBITDA of 7.53.
Despite a strong one-year return of 97.25% compared to the S&P 500's 10.26%, the current valuation metrics suggest that Lifeway Foods, Inc. is not justified given its high multiples relative to peers. The company's financial performance, reflected in its ROCE of 21.66% and ROE of 13.67%, does not sufficiently support its elevated valuation, reinforcing the conclusion of being overvalued.