Is RCI Hospitality Holdings, Inc. overvalued or undervalued?

As of 24 April 2025, the valuation grade for RCI Hospitality Holdings, Inc. has moved from fair to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued. Key ratios include a P/E ratio of 10, an EV to EBITDA of 8.72, and a PEG ratio of 2.88, which suggests that the stock is not priced attractively relative to its earnings growth potential.
In comparison to peers, RCI Hospitality Holdings, Inc. has a lower P/E ratio than First Watch Restaurant Group, Inc., which stands at 54.78, but it is still deemed very expensive. Other risky peers like Sweetgreen, Inc. and Cannae Holdings, Inc. show negative P/E ratios, further highlighting the challenges within the industry. Additionally, the company's stock has underperformed against the S&P 500, with a year-to-date return of -31.55% compared to the index's 2.44%, reinforcing the notion of overvaluation in the current market environment.