Is SES AI Corp. overvalued or undervalued?

As of 25 February 2025, SES AI Corp. has moved from a grade of does not qualify to risky, indicating a significant deterioration in its valuation outlook. The company appears to be overvalued given its financial metrics, including a Price to Book Value of 1.41, an EV to EBIT of -1.30, and an EV to EBITDA of -1.41. These ratios suggest that the company is struggling to generate positive earnings, with a ROCE of -339.95% and a ROE of -36.78%, further reinforcing concerns about its financial health.
In comparison to its peers, SES AI Corp. stands out negatively against HollySys Automation Technologies Ltd., which has a P/E ratio of 21.82, and Thermon Group Holdings, Inc., with a P/E of 17.02. The stark contrast in valuation metrics highlights the challenges SES AI Corp. faces in the market. Additionally, the company's stock has significantly underperformed relative to the S&P 500, with a year-to-date decline of 61.88% compared to a modest gain of 2.44% for the index. Overall, SES AI Corp. is deemed overvalued in its current state.