Is Service Properties Trust overvalued or undervalued?

As of 7 August 2023, the valuation grade for Service Properties Trust has moved from very attractive to risky, indicating a shift in perception regarding its financial health. The company appears to be overvalued, particularly given its significant losses reflected in the P/E ratio, which is not applicable due to negative earnings. Key ratios include a Price to Book Value of 0.53, an EV to EBITDA of 0.54, and an EV to Sales of 0.16, all suggesting that the stock is trading at a low valuation relative to its assets and sales.
In comparison to peers, Service Properties Trust has a P/E ratio of -2.31 and an EV to EBITDA of 0.7028, which further emphasizes its underperformance within the industry. Notably, the company has experienced a -37.63% return over the past year, while the S&P 500 has gained 17.14%, highlighting its struggles in the market. Overall, these factors contribute to the conclusion that Service Properties Trust is overvalued at its current price.