Is SPAR Group, Inc. overvalued or undervalued?

As of 10 February 2025, the valuation grade for SPAR Group, Inc. has moved from fair to risky, indicating a shift towards a more concerning outlook. The company appears to be overvalued given its financial metrics, particularly with a Price to Book Value of 1.02 and an EV to EBITDA ratio of 14.42, which suggests a premium valuation relative to its earnings potential. Additionally, the ROE stands at -11.05%, highlighting ongoing losses and inefficiencies in generating returns for shareholders.
In comparison to its peers, SPAR Group, Inc. has a significantly negative P/E ratio of -2.04, while IBEX Ltd. boasts an attractive P/E of 10.62, showcasing a stark contrast in profitability and market perception. Other risky peers, such as National CineMedia, Inc. and Marchex, Inc., also reflect poor valuations with P/E ratios of -20.35 and -19.31, respectively. Notably, SPAR Group's stock has underperformed against the S&P 500 over the past year, with a return of -51.25% compared to the index's 17.14%, reinforcing the notion that the stock is currently overvalued.