Is Selective Insurance Group, Inc. overvalued or undervalued?

As of 30 April 2025, the valuation grade for Selective Insurance Group, Inc. has moved from expensive to very expensive. The company is currently overvalued based on its high P/E ratio of 39, which significantly exceeds the industry average. Additionally, the EV to EBITDA ratio stands at an exorbitant 251.37, further indicating that the stock is priced well above its earnings potential. The dividend yield is relatively low at 0.98%, and the ROE is only 7.26%, suggesting limited returns for shareholders.
In comparison to peers, Selective Insurance Group's P/E ratio of 39 is starkly higher than Markel Group, Inc. at 13.70 and Loews Corp. at 15.00, both of which are considered fairly valued. This disparity highlights the overvaluation of Selective Insurance Group in the current market. Furthermore, while the stock has shown some short-term resilience with a 1-week return of 2.58% against a slight decline in the S&P 500, its year-to-date performance is down 6.50%, contrasting with the S&P 500's gain of 2.44%. Overall, the valuation metrics and peer comparisons strongly suggest that Selective Insurance Group, Inc. is overvalued.