Is Nelnet, Inc. overvalued or undervalued?

As of 26 February 2025, the valuation grade for Nelnet, Inc. has moved from fair to attractive, indicating a positive shift in its perceived value. The company is currently considered undervalued based on its strong financial metrics. Notable ratios include a P/E ratio of 17, a PEG ratio of 0.35, and an impressive ROCE of 39.69%.
In comparison to peers, Nelnet's P/E ratio of 16.63 is more favorable than Air Lease Corp.'s 14.59, while it is significantly lower than Herc Holdings, Inc.'s 21.01, which is categorized as very expensive. Additionally, Nelnet's EV to EBITDA ratio of 3.04 is competitive against PennyMac Financial Services, Inc.'s 3.11, further supporting its attractive valuation. The company's recent stock performance has outpaced the S&P 500, with a 1-year return of 16.16% compared to the index's 10.26%, reinforcing the notion that Nelnet is currently undervalued.