Is O'Reilly Automotive, Inc. overvalued or undervalued?

As of 27 October 2021, the valuation grade for O'Reilly Automotive, Inc. moved from fair to risky, indicating a shift in its perceived value. The company appears overvalued based on several key metrics, including a P/E ratio of 33, an EV to EBITDA ratio of 22.72, and a PEG ratio of 12.01. Comparatively, AutoZone, Inc. has a lower P/E of 31.63 and an EV to EBITDA of 20.91, while Walmart, Inc. is considered expensive with a P/E of 39.50.
Despite the recent stock performance, where O'Reilly outperformed the S&P 500 with a 37.25% return over the past year compared to the S&P's 17.14%, the elevated valuation ratios suggest caution. The negative book value and high PEG ratio further reinforce the notion that the stock may be overvalued in the current market context.