Is Polar Power, Inc. overvalued or undervalued?

As of 10 February 2020, Polar Power, Inc. has moved from a fair to a risky valuation grade, indicating a significant deterioration in its financial outlook. The company is currently considered overvalued, primarily due to its negative earnings and poor return metrics. Key ratios include a Price to Book Value of 0.60, an EV to EBITDA of -3.21, and a ROE of -52.38%, all suggesting substantial financial distress compared to its peers.
In the peer comparison, Polar Power's EV to EBITDA ratio of -3.21 is notably worse than Babcock & Wilcox Enterprises, Inc. at 11.0256 and Profire Energy, Inc. with a positive EV to EBITDA of 10.6995, highlighting its underperformance in the industry. Furthermore, while the company saw a 30.58% return over the past month, it still lags behind the S&P 500's 2.33% return, and its long-term performance has been severely negative, with a 3-year return of -88.43% compared to the S&P 500's 70.41%.