Is Sun Country Airlines Holdings, Inc. overvalued or undervalued?

As of 2 May 2025, the valuation grade for Sun Country Airlines Holdings, Inc. has moved from expensive to very expensive, indicating a significant shift in its perceived market value. The company is currently overvalued, with a P/E ratio of 12, which is notably higher than its peer, Air Transport Services Group, Inc., which has a P/E of 54.21. Additionally, the EV to EBITDA ratio stands at 3.88, while the industry average is considerably higher, suggesting that the company is not performing well relative to its peers.
In comparison to its competitors, Sun Country Airlines' financial metrics reveal a concerning outlook. The ROCE is 13.96% and ROE is 8.98%, which are lower than desirable for attracting investors in a competitive market. Furthermore, the company's stock has underperformed against the S&P 500, with a year-to-date return of -25.45% compared to the S&P 500's 2.44%. This combination of high valuation ratios and poor stock performance reinforces the conclusion that Sun Country Airlines Holdings, Inc. is overvalued in the current market.