Is Super Group (SGHC) Ltd. overvalued or undervalued?

As of 13 June 2025, the valuation grade for Super Group (SGHC) Ltd. has moved from expensive to very expensive, indicating a significant increase in perceived valuation. The company is currently overvalued based on its financial ratios. The P/E ratio stands at 26, which is higher than the peer average of 14.30 for International Game Technology PLC, while the EV to EBITDA ratio is 11.83 compared to 6.64 for the same peer. Additionally, the PEG ratio of 0.42 suggests that the stock may not be justified at its current price given its growth prospects.
In terms of performance metrics, Super Group boasts a high ROCE of 88.46% and an ROE of 25.73%, which are impressive figures; however, they do not sufficiently offset the high valuation multiples. The company's recent stock performance has outpaced the S&P 500, with a year-to-date return of 56.66% compared to just 2.44% for the index. Despite this strong performance, the elevated valuation ratios indicate that Super Group (SGHC) Ltd. is overvalued in the current market context.