Is Stitch Fix, Inc. overvalued or undervalued?

As of 8 June 2020, the valuation grade for Stitch Fix, Inc. moved from expensive to risky, indicating a significant shift in its perceived financial health. The company is currently considered overvalued, primarily due to its negative earnings and substantial losses reflected in key ratios. The Price to Book Value stands at 3.02, while the EV to EBITDA is notably at -19.14, and the ROE is reported at -19.34%.
In comparison to its peers, Stitch Fix's valuation appears unfavorable. For instance, Winmark Corp. has a P/E ratio of 38.17, and Shoe Carnival, Inc. shows a more attractive P/E of 12.12, highlighting the disparity in valuation metrics. Additionally, the company's recent stock performance has lagged behind the S&P 500, with a year-to-date return of -10.44% compared to the index's 2.44%, reinforcing the notion that Stitch Fix is currently overvalued in the market.