Is RGC Resources, Inc. overvalued or undervalued?

Jun 25 2025 08:51 AM IST
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As of April 3, 2025, RGC Resources, Inc. is considered overvalued with a P/E ratio of 16, higher than its peers, and despite a respectable ROE of 11.24% and a dividend yield of 3.85%, its long-term performance has lagged, indicating that the current price may not be sustainable.
As of 3 April 2025, RGC Resources, Inc. has moved from a fair to an expensive valuation grade. The company is currently overvalued, with a P/E ratio of 16, which is higher than its peer Northwest Natural Holding Co. at 13.57 and Excelerate Energy, Inc. at 19.29. Additionally, RGC's EV to EBITDA stands at 11.61, indicating a premium compared to the industry average.

Notably, RGC Resources has a Price to Book Value of 1.81 and a Dividend Yield of 3.85%. The company's ROE is 11.24%, which is respectable, but when compared to its peers, it does not justify the current valuation. Furthermore, while RGC has outperformed the S&P 500 in the short term, its long-term performance has lagged significantly, suggesting that the current price may not be sustainable.
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