Is The Children's Place, Inc. overvalued or undervalued?

As of 16 March 2023, The Children's Place, Inc. has moved from an expensive to a risky valuation grade, indicating a significant deterioration in its perceived value. The company appears to be overvalued given its current metrics, particularly with a Price to Book Value of -2.55 and an EV to EBIT ratio of 36.05, which suggests high leverage and low profitability. Additionally, the EV to EBITDA ratio stands at 10.98, further highlighting the company's struggles in generating earnings relative to its enterprise value.
In comparison to its peers, The Children's Place, Inc. has a notably negative P/E ratio of -5.67, while Shoe Carnival, Inc. and Caleres, Inc. boast attractive P/E ratios of 15.54 and 7.43, respectively. This stark contrast underscores the company's challenges in the footwear industry. Furthermore, the company's stock has significantly underperformed against the S&P 500, with a year-to-date return of -33.65% compared to the index's 12.22%, reinforcing the notion that the stock is currently overvalued.