Is Middlesex Water Co. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Middlesex Water Co. moved from very expensive to expensive. Based on the current metrics, the company appears to be overvalued. The P/E ratio stands at 23, which is higher than the peer average of 22.05 for similar companies. Additionally, the EV to EBITDA ratio is 25.42, significantly above the industry average of 16.30, indicating a premium valuation compared to peers like Essential Utilities, Inc. with an EV to EBITDA of 14.36 and American States Water Co. at 15.88.
Furthermore, the PEG ratio of 1.26 suggests that the stock is priced higher relative to its growth rate, reinforcing the overvaluation perspective. In terms of recent performance, while Middlesex Water Co. outperformed the S&P 500 over the past week and month, it has significantly lagged behind in the longer-term returns, with a 1-year return of -11.59% compared to the S&P 500's 14.08%. This disparity highlights the potential risk of holding an overvalued stock in a rising market.