Is Lyra Therapeutics, Inc. overvalued or undervalued?

As of 12 August 2025, the valuation grade for Lyra Therapeutics, Inc. changed from risky to does not qualify, indicating a significant deterioration in its financial standing. The company is overvalued given its high Price to Book Value of 8.31 and negative EV to EBIT and EV to EBITDA ratios of -0.10, suggesting that it is not generating positive earnings or cash flow. Additionally, the Return on Equity (ROE) is alarmingly low at -1111.31%, further underscoring the company's struggles.
In comparison to its peers, Lyra Therapeutics, Inc. shows stark contrasts; for instance, 2seventy Bio, Inc. has a P/E ratio of 76.93, while Scilex Holding Co. and Generation Bio Co. also reflect negative valuations. The company's stock performance has been dismal, with a year-to-date return of -38.47% compared to the S&P 500's gain of 12.22%, and a staggering -98.94% return over the past five years against the S&P 500's 96.61%. This further reinforces the conclusion that Lyra Therapeutics is currently overvalued.