Is Nerdy, Inc. overvalued or undervalued?

As of 28 February 2023, the valuation grade for Nerdy, Inc. has moved from fair to risky, indicating a significant deterioration in its financial outlook. The company appears to be overvalued given its current financial metrics, particularly with a Price to Book Value of 9.54 and a negative ROE of -207.40%. Additionally, its EV to EBITDA stands at -4.28, further highlighting the challenges it faces in generating positive earnings.
When compared to peers, Nerdy, Inc. shows a concerning position; for instance, SoundHound AI, Inc. has a P/E ratio of -30.40, while Ribbon Communications, Inc. has a P/E of -18.09, both indicating a similar risk profile. The company's recent stock performance has lagged behind the S&P 500, with a one-year return of -2.99% compared to the S&P 500's 10.26%. Overall, the combination of poor financial ratios and relative performance suggests that Nerdy, Inc. is overvalued in the current market environment.