Is MBIA, Inc. overvalued or undervalued?

As of 27 February 2025, the valuation grade for MBIA, Inc. has moved from does not qualify to risky, indicating a shift in perception regarding its financial health. The company appears to be overvalued, particularly given its negative P/E ratio of -9.74 and a price to book value of -0.58, which suggests significant underlying issues. Additionally, the EV to Capital Employed ratio stands at 5.14, further highlighting the company's high valuation relative to its capital efficiency.
In comparison to peers, Investors Title Co. holds an attractive valuation with a P/E of 16.43, while Ambac Financial Group, Inc. is also classified as risky with a P/E of -9.85. The stark contrast in valuations raises concerns about MBIA's market position. Notably, while MBIA has shown a remarkable 106.61% return over the past year, it still lags behind the S&P 500's 17.14% return, reflecting a volatile performance that may not justify its current valuation.