Is The Beauty Health Co. overvalued or undervalued?

As of 10 May 2023, The Beauty Health Co. has moved from a fair to a risky valuation grade. The company appears to be overvalued given its negative financial metrics, including a P/E ratio of NA due to being loss-making, a Price to Book Value of 4.38, and an EV to EBITDA of -12.23. The return on capital employed (ROCE) stands at -27.18%, and the return on equity (ROE) is alarmingly low at -94.21%, indicating significant operational challenges.
In comparison to its peers, The Beauty Health Co. shows stark contrasts; for instance, LeMaitre Vascular, Inc. has a P/E ratio of 43.25 and an EV to EBITDA of 29.02, reflecting a healthier valuation profile. Other peers like MiMedx Group, Inc. also demonstrate better metrics with a P/E of 21.59 and an EV to EBITDA of 13.06. The company's recent stock performance, with a 1-week return of 25.32% compared to a slight decline in the S&P 500, may suggest short-term volatility, but the underlying financial ratios indicate that it is currently overvalued in the broader market context.