Is Optex Systems Holdings, Inc. overvalued or undervalued?

As of 7 July 2025, Optex Systems Holdings, Inc. moved from fair to attractive in its valuation grade, indicating a positive shift in its market perception. The company appears undervalued, supported by a P/E ratio of 14, a PEG ratio of 0.36, and an EV to EBITDA ratio of 9.62. In comparison, peers such as Espey Manufacturing & Electronics Corp. have a significantly higher P/E ratio of 21.99, while Optex's own valuation metrics suggest it is positioned favorably within its industry.
The company's strong performance is further highlighted by its impressive return figures, with a year-to-date return of 79.88% compared to the S&P 500's 12.22%, and a remarkable 3-year return of 391.63% against the S&P 500's 70.41%. This performance reinforces the notion that Optex Systems Holdings, Inc. is currently undervalued relative to its growth potential and market performance.