Is NVE Corp. overvalued or undervalued?

As of 7 May 2025, the valuation grade for NVE Corp. has moved from expensive to very attractive, indicating a significant improvement in its valuation outlook. Based on the metrics provided, NVE Corp. appears to be undervalued. The company has a P/E ratio of 23, which is relatively low compared to its peers, such as indie Semiconductor, Inc. with a P/E of -5.76, and Canadian Solar, Inc. at -5.79. Additionally, NVE Corp. boasts a robust ROCE of 39.37% and a high dividend yield of 551.75%, further supporting its attractive valuation.
In terms of peer comparison, NVE Corp. has a more favorable EV to EBITDA ratio of 20.15 compared to its peers, which are all categorized as risky. Despite recent underperformance, with a year-to-date return of -17.68% compared to the S&P 500's 12.22%, the long-term outlook remains promising, as evidenced by a 3-year return of 34.90%. Overall, NVE Corp. is positioned as an attractive investment opportunity in the Other Electrical Equipment industry.