Is Springworks Therapeutics, Inc. overvalued or undervalued?

As of 27 February 2024, the valuation grade for Springworks Therapeutics, Inc. has moved from does not qualify to risky. The company appears to be overvalued based on its financial metrics, particularly given its high Price to Book Value of 8.45 and negative EV to EBITDA of -12.42. Additionally, the negative ROCE of -201.75% and ROE of -59.66% further indicate significant financial distress compared to its peers.
In the peer comparison, Springworks Therapeutics has a P/E ratio of -14.1396, while Biohaven Ltd. and Neumora Therapeutics, Inc. do not qualify for a P/E ratio, highlighting the relative riskiness of Springworks. The company’s recent stock performance shows a year-to-date return of 30.06%, which outpaces the S&P 500's return of 12.22%, suggesting some market optimism despite the underlying valuation concerns. Overall, Springworks Therapeutics is considered overvalued in the current market context.