Is The Lovesac Co. overvalued or undervalued?

As of 21 November 2025, The Lovesac Co. has moved from very expensive to fair in valuation grade. The company appears to be fairly valued based on its current metrics. Key ratios include a P/E ratio of 25, an EV to EBITDA of 8.22, and a Price to Book Value of 1.36. In comparison, Ethan Allen Interiors, Inc. has a higher P/E ratio of 28.41, indicating a more expensive valuation, while Arhaus, Inc. shows a P/E of 22.58, also reflecting a premium over Lovesac.
Despite the recent grade change, The Lovesac Co. has significantly underperformed relative to the S&P 500, with a year-to-date return of -48.10% compared to the S&P 500's 12.26%. This stark contrast in performance suggests that while the company may be fairly valued, it faces challenges that have impacted its stock price considerably.