Is LSI Industries, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for LSI Industries, Inc. has moved from attractive to very expensive, indicating a shift in perception regarding its valuation. The company appears overvalued based on its current metrics, with a P/E ratio of 21, a Price to Book Value of 2.25, and an EV to EBITDA ratio of 11.86. In comparison, peers such as Quanex Building Products Corp. have a higher P/E of 26.26 and a significantly lower EV to EBITDA of 8.05, highlighting the relative expense of LSI Industries.
Despite strong performance in the past, with a 1-year return of 32.83% compared to the S&P 500's 14.08%, the company's valuation metrics suggest that it is priced too high relative to its earnings potential and industry peers. This overvaluation is further emphasized by the company's EV to Capital Employed ratio of 1.99, which also indicates a premium valuation.