Is National Vision Holdings, Inc. overvalued or undervalued?

As of 9 November 2023, the valuation grade for National Vision Holdings, Inc. has moved from expensive to risky. The company appears to be overvalued given its high P/E ratio of 122, a Price to Book Value of 2.01, and an EV to EBIT of 65.78. In comparison, peers such as Group 1 Automotive, Inc. have a more reasonable P/E of 18.26 and EV to EBITDA of 13.38, while Rush Enterprises, Inc. shows a fair P/E of 15.86 and EV to EBITDA of 8.70.
Despite strong recent performance, with a year-to-date return of 153.65% compared to the S&P 500's 12.22%, the underlying valuation metrics suggest that National Vision is not justified at its current price level. The company's low ROCE of 2.60% and ROE of 1.65% further indicate inefficiencies that contribute to its risky valuation status.