Is Masco Corp. overvalued or undervalued?

As of 28 April 2021, the valuation grade for Masco Corp. has moved from expensive to risky, indicating a shift in perception regarding its financial health and market position. The company appears to be undervalued given its current P/E ratio of 16, which is lower than the industry average of 18.85 for Allegion Plc, and its EV to EBITDA of 10.84, which is also favorable compared to peers like Watsco, Inc. with an EV to EBITDA of 24.12. Additionally, Masco's ROCE stands at an impressive 54.43%, suggesting strong operational efficiency despite its negative book value.
In comparison to its peers, Masco Corp. has a P/E ratio of 15.28, which is significantly lower than Watsco, Inc. at 32.52 and A. O. Smith Corp. at 21.94. This positions Masco as an attractive investment opportunity, especially considering its dividend yield of 2.02% and the recent stock performance, which has outpaced the S&P 500 by 0.74% over the past week. Overall, Masco Corp. is currently undervalued, presenting a potential opportunity for investors looking for growth in the home improvement sector.