Is Soleno Therapeutics, Inc. overvalued or undervalued?

As of 6 August 2025, the valuation grade for Soleno Therapeutics, Inc. has moved from does not qualify to risky, indicating a heightened level of concern regarding its financial health. The company appears to be overvalued given its negative performance metrics, including a P/E ratio of NA due to losses, a Price to Book Value of 16.38, and a troubling ROE of -82.85%.
In comparison to its peers, Soleno's EV to EBITDA stands at -17.64, while Arcutis Biotherapeutics, Inc. and EyePoint Pharmaceuticals, Inc. have ratios of -24.8858 and -3.6610, respectively. This suggests that Soleno is not only underperforming relative to its industry but also faces significant challenges in generating positive returns. Notably, over the past year, Soleno's stock has returned 5.66%, significantly lagging behind the S&P 500's return of 17.14%, reinforcing the notion that the stock is overvalued in its current state.