Is Talos Energy, Inc. overvalued or undervalued?

As of 18 June 2025, the valuation grade for Talos Energy, Inc. has moved from attractive to very expensive, indicating a significant shift in its perceived value. The company appears to be overvalued based on its current metrics, particularly with a P/E ratio that is not applicable due to losses, a Price to Book Value of 0.52, and an EV to EBITDA ratio of 1.84. These figures suggest that the company is struggling to generate positive earnings, which is further reflected in its ROCE of 3.61% and ROE of -0.32%.
In comparison to its peers, Talos Energy's valuation stands out unfavorably. For instance, Comstock Resources, Inc. has a P/E ratio of 166.82, while Magnolia Oil & Gas Corp. shows a more attractive P/E of 13.72 and an EV to EBITDA of 6.05. This stark contrast highlights the challenges Talos faces in the current market environment. Additionally, the company's recent stock performance has lagged behind the S&P 500, with a one-year return of -21.21% compared to the index's 10.26%, reinforcing the notion that Talos Energy is currently overvalued.