Is MYR Group, Inc. overvalued or undervalued?

As of 31 January 2025, the valuation grade for MYR Group, Inc. has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently assessed as overvalued. Key ratios highlight this position, with a P/E ratio of 74, an EV to EBITDA of 21.59, and a Price to Book Value of 4.68, all of which are substantially higher than industry norms.
In comparison to its peers, MYR Group's P/E ratio is notably higher than Dycom Industries, Inc. at 28.83 and Sterling Infrastructure, Inc. at 23.94, both of which are considered less expensive. Additionally, MYR Group's ROCE stands at 9.03% and ROE at 6.31%, which do not justify its elevated valuation compared to its peers. The company's recent stock performance has outpaced the S&P 500, with a 1-year return of 23.70% versus the S&P 500's 10.26%, yet this does not mitigate the concerns regarding its current valuation.