Is Texas Community Bancshares, Inc. overvalued or undervalued?

As of 12 May 2025, the valuation grade for Texas Community Bancshares, Inc. has moved from expensive to fair. The company is currently fairly valued, with a P/E ratio of 24, a price to book value of 0.92, and a PEG ratio of 0.13. In comparison to its peers, Magyar Bancorp, Inc. is very attractive with a P/E of 11.74, while IF Bancorp, Inc. is also fair with a P/E of 26.73.
Despite being fairly valued, Texas Community Bancshares, Inc. shows a relatively low return on equity (ROE) of 3.83% and a return on capital employed (ROCE) of 2.29%, which may indicate potential growth challenges. Over the past year, the company's stock has returned 8.81%, slightly underperforming the S&P 500's return of 10.26%, suggesting that while the valuation is fair, there may be better opportunities in the market.