Is Motorsport Games, Inc. overvalued or undervalued?

As of 20 March 2025, the valuation grade for Motorsport Games, Inc. has moved from attractive to risky, indicating a significant deterioration in its financial outlook. The company is currently considered overvalued, particularly given its negative P/E ratio and troubling financial metrics. Key ratios include a price-to-book value of 16.12, an EV to EBIT of -2.95, and an EV to EBITDA of -5.24, all of which suggest that the company's valuation does not align with its financial performance.
In comparison to its peers, Motorsport Games, Inc. has a P/E ratio of -4.4102, while Next Technology Holding, Inc. is rated fair with a P/E of -38.1654, and GigaMedia Ltd. is also risky with a P/E of -8.0686. These comparisons highlight the challenges faced by Motorsport Games, Inc. in the current market landscape. Additionally, the company's recent stock performance has been lackluster, with a year-to-date return of 105.97%, significantly outperforming the S&P 500's 2.44%, but this does not mitigate the concerns raised by its financial ratios.