Is Setco Automotive overvalued or undervalued?
As of April 25, 2023, Setco Automotive is considered overvalued and risky due to its negative PE ratio of -2.30 and unfavorable financial metrics compared to peers, despite a strong 1-year stock return of 75.61%.
As of 25 April 2023, the valuation grade for Setco Automotive has moved from does not qualify to risky, indicating a significant change in its perceived financial health. The company is currently overvalued based on its negative PE ratio of -2.30 and price to book value of -0.35, which suggest underlying issues with profitability and asset valuation. Additionally, the EV to EBITDA ratio stands at 12.24, which, while not excessively high, does not compensate for the negative earnings indicators.In comparison to its peers, Setco Automotive's valuation appears unfavorable. For instance, Samvardhana Motherson has a PE ratio of 29.14 and an EV to EBITDA of 11.53, reflecting a more robust financial position. Other peers like Bosch and Uno Minda are categorized as expensive, with PE ratios of 46.21 and 66.72, respectively. Despite a strong 1-year stock return of 75.61%, the overall financial metrics and peer comparisons suggest that Setco Automotive is overvalued in the current market context.
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