Is Navient Corp. overvalued or undervalued?

As of 7 July 2025, the valuation grade for Navient Corp. has moved from expensive to attractive, indicating a shift in perception towards the company's value. Based on the available metrics, Navient appears to be undervalued, particularly when considering its P/E ratio of 58, which is significantly higher than peers like Mr. Cooper Group, Inc. with a P/E of 29.22, and Air Lease Corp. at 16.14. Additionally, the company has a Price to Book Value of 2.07 and an EV to EBITDA of 1.01, suggesting that while it may be trading at a premium, its underlying assets and earnings potential could justify this valuation.
In comparison to its peers, Navient's high ROCE of 586.52% stands out, indicating strong returns on capital employed. However, its recent stock performance has been mixed, with a year-to-date return of 0.38% compared to the S&P 500's 12.22%, and a one-year return of -16.68% against the S&P 500's 17.14%. This underperformance over the short term may contribute to the perception of undervaluation, despite the attractive valuation metrics. Overall, Navient Corp. presents a compelling case for being undervalued in the current market context.