Is Magic Software Enterprises Ltd. overvalued or undervalued?

Jun 25 2025 08:41 AM IST
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As of May 21, 2025, Magic Software Enterprises Ltd. is considered undervalued with an attractive valuation grade, a P/E ratio of 18, and a 72.28% return over the past year, outperforming the S&P 500.
As of 21 May 2025, the valuation grade for Magic Software Enterprises Ltd. has moved from fair to attractive, indicating a positive shift in its perceived value. The company is currently considered undervalued based on its financial metrics. The P/E ratio stands at 18, with a PEG ratio of 1.97 and an EV to EBITDA ratio of 9.03, suggesting that the stock is reasonably priced relative to its earnings growth potential.

In comparison to its peers, Magic Software Enterprises Ltd. has a more favorable valuation than Karooooo Ltd., which has a P/E ratio of 26.91, and significantly better than the risky Matterport, Inc. and Planet Labs PBC, which have negative P/E ratios. Additionally, the company's return over the past year has outperformed the S&P 500, with a 72.28% increase compared to the index's 10.26%, reinforcing the attractiveness of its current valuation.
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