Is Nektar Therapeutics overvalued or undervalued?

As of 8 August 2019, the valuation grade for Nektar Therapeutics has moved from fair to risky, indicating a shift towards a more negative outlook. The company appears to be overvalued given its current financial metrics, particularly with a Price to Book Value of 9.02 and an EV to Sales ratio of 0.15, which suggests that the market is pricing in significant future growth despite the company's ongoing losses. Additionally, the negative ROE of -860.22% further underscores the challenges the company faces in generating returns for shareholders.
In comparison with peers, Nektar Therapeutics has a P/E ratio of -7.21, which is significantly lower than typical industry valuations, indicating that it is not only struggling relative to its competitors but also facing severe operational difficulties. The stock has shown impressive short-term performance, with a 1-month return of 114.22% compared to the S&P 500's 2.33%, but this should be viewed cautiously in light of the company's longer-term performance, where it has declined by 80.58% over the past five years. Overall, the combination of high valuation ratios and negative financial indicators suggests that Nektar Therapeutics is overvalued at its current price.