Is Rayonier Advanced Materials, Inc. overvalued or undervalued?

As of 7 November 2023, the valuation grade for Rayonier Advanced Materials, Inc. has moved from attractive to risky, indicating a shift in perception regarding its investment potential. The company appears to be overvalued based on its current financial metrics, particularly given its negative P/E ratio and ROE of -1.34%. Key ratios include a Price to Book Value of 0.38, an EV to EBITDA of 4.58, and an EV to Sales of 0.55, which suggest that the company is trading at a significant discount relative to its sales and earnings potential, yet the overall financial health raises concerns.
In comparison to peers, Westlake Chemical Partners LP, which is rated very attractive, has a P/E ratio of 2.42 and an EV to EBITDA of 2.50, highlighting a stark contrast in valuation and performance. Similarly, Mativ Holdings, Inc. is also rated risky with a P/E of -22.21 and an EV to EBITDA of 9.54, further emphasizing the challenges faced by Rayonier Advanced Materials. Despite a strong recent performance with a 1-month return of 38.72% compared to the S&P 500's 2.33%, the longer-term outlook remains concerning, as evidenced by a year-to-date return of -13.58% versus the S&P 500's 12.22%.