Is Tootsie Roll Industries, Inc. overvalued or undervalued?

As of 17 October 2025, Tootsie Roll Industries, Inc. has moved from a very expensive to a fair valuation grade. The company appears to be fairly valued based on its current metrics. The P/E ratio stands at 35, while the EV to EBITDA ratio is 21.41, and the Price to Book Value is 3.42. In comparison to peers, Balchem Corp. has a P/E of 36.79 and Lancaster Colony Corp. has a P/E of 27.91, indicating that Tootsie Roll's valuation is competitive within its industry.
Despite the fair valuation, Tootsie Roll's recent stock performance shows a 47.63% return over the past year, significantly outperforming the S&P 500's 14.08% return, suggesting strong market confidence in the company. However, over longer periods, such as the 3-year and 5-year returns, Tootsie Roll has underperformed relative to the S&P 500, which raises some caution regarding its long-term growth prospects.