Is MGE Energy, Inc. overvalued or undervalued?

As of 7 May 2025, MGE Energy, Inc. has moved from a valuation grade of very expensive to expensive. The company is currently considered overvalued based on its financial ratios. The P/E ratio stands at 25, which is significantly higher than peers such as IDACORP, Inc. at 20.31 and NorthWestern Corp. at 13.22. Additionally, the EV to EBITDA ratio for MGE Energy is 14.59, compared to IDACORP's 13.48, indicating a premium valuation relative to its peers.
Other notable ratios include a Price to Book Value of 2.56 and a PEG Ratio of 4.50, both of which further emphasize the expensive nature of the stock. Despite a strong one-year return of 18.45% compared to the S&P 500's 10.26%, the overall valuation metrics suggest that MGE Energy, Inc. is overvalued in the current market environment.