Is nLIGHT, Inc. overvalued or undervalued?

As of 19 February 2020, the valuation grade for nLIGHT, Inc. moved from very expensive to risky, indicating a shift in perception regarding its financial health. The company is currently considered overvalued. Key ratios include a Price to Book Value of 4.09, an EV to EBIT of -13.80, and an EV to EBITDA of -19.71, all of which highlight significant challenges in profitability and valuation metrics.
When compared to peers, nLIGHT, Inc. shows a stark contrast with Semtech Corp., which has a P/E ratio of 89.37, and SMART Global Holdings, Inc. with an EV to EBITDA of 8.15. These comparisons further emphasize nLIGHT's unfavorable position within its industry. Additionally, while nLIGHT has shown a strong year-to-date stock return of 67.78%, this is juxtaposed against a backdrop of overall underperformance over longer periods, suggesting that despite short-term gains, the company's long-term valuation remains precarious.