Is The Toro Co. overvalued or undervalued?

As of 4 September 2025, The Toro Co. has moved from an expensive to a very expensive valuation grade. The company is overvalued, as indicated by its P/E ratio of 21, which is significantly higher than its peers like CNH Industrial NV at 19.42 and AGCO Corp. at 14.36. Additionally, the Price to Book Value stands at 5.63, and the EV to EBITDA ratio is 14.54, further supporting the conclusion of overvaluation.
In comparison to its peers, The Toro Co. exhibits a higher valuation profile, with its EV to EBIT ratio at 18.32 compared to CNH Industrial's 10.28. The company's recent stock performance has lagged behind the S&P 500, with a year-to-date return of -0.20% versus the S&P 500's 12.22%, and a 1-year return of -6.37% compared to 17.14% for the index, reinforcing the notion of overvaluation.