Is Netcapital, Inc. overvalued or undervalued?

As of 17 March 2025, the valuation grade for Netcapital, Inc. has moved from risky to does not qualify, indicating a significant deterioration in its financial standing. The company is currently considered overvalued, particularly given its troubling financial ratios, including a Price to Book Value of 0.17 and an EV to EBIT of -0.96. Additionally, the company's Return on Capital Employed (ROCE) stands at -21.68%, reflecting ongoing losses and inefficiencies.
In comparison to its peers, such as BTC Digital Ltd. with a P/E ratio of -9.96 and TRxADE HEALTH, Inc. at -0.61, Netcapital's performance appears weaker, especially with an EV to Sales ratio of 7.68, which suggests that investors are paying a high premium for sales that are not translating into profits. Despite a recent surge in stock price, with a 1-month return of 123.68% compared to the S&P 500's 3.83%, the long-term outlook remains concerning, as evidenced by a 1-year return of -45.35%.