Is Thermon Group Holdings, Inc. overvalued or undervalued?

As of 7 August 2025, the valuation grade for Thermon Group Holdings, Inc. has moved from attractive to very attractive, indicating a strong improvement in its valuation outlook. The company appears to be undervalued, with a P/E ratio of 17, which is higher than the peer average of approximately 16.64 for similar companies like Encore Wire Corp. and AZZ, Inc. Additionally, Thermon has an EV to EBITDA ratio of 10.00, which is competitive compared to peers such as Powell Industries, Inc. at 14.12.
In terms of performance, Thermon Group's recent stock returns have lagged behind the S&P 500, with a year-to-date return of -5.84% compared to the index's 12.22%. However, over a five-year period, Thermon has significantly outperformed the S&P 500 with a return of 129.58% versus 96.61%. Overall, the combination of strong valuation ratios and a favorable comparison to peers suggests that Thermon Group Holdings, Inc. is currently undervalued.