Is Pagaya Technologies Ltd. overvalued or undervalued?

As of 16 August 2022, the valuation grade for Pagaya Technologies Ltd. moved from does not qualify to risky, indicating increased uncertainty regarding its financial health. Based on the provided metrics, the company appears to be overvalued, particularly given its high P/E ratio of 71.76 and EV to EBITDA ratio of 14.25, which are significantly above typical industry benchmarks. Additionally, the Price to Book Value stands at 3.95, further suggesting that the stock may not be justified at its current price level.
In comparison to peers, Amplitude, Inc. has a P/E ratio of -15.58 and SEMrush Holdings, Inc. shows a P/E ratio of -436.51, highlighting that Pagaya's valuation metrics are out of line with those of its competitors. Despite impressive recent returns, with a year-to-date stock return of 371.58% compared to the S&P 500's 12.22%, the underlying financial ratios indicate that the stock's current valuation may not be sustainable in the long term.