Is Tree House Edu. overvalued or undervalued?

As of 12 May 2025, the valuation grade for Tree House Education has moved from very expensive to risky. The company is currently assessed as overvalued based on its financial ratios and peer comparisons. Key ratios include a PE ratio of -2.02, an EV to EBITDA of -10.68, and a Price to Book Value of 0.18, indicating significant financial distress and negative earnings.
In comparison to its peers, Tree House Edu. shows a stark contrast with Veranda Learning, which has a PE ratio of 165.27 but is also loss-making, and Shanti Education, valued at 199.65. Other peers like Zee Learn and CP Capital are considered attractive and very attractive, respectively, with PE ratios of 15.37 and 6.42, highlighting the disparity in valuation. Additionally, Tree House's stock has underperformed significantly against the Sensex, particularly with a year-to-date return of -50.41% compared to the Sensex's 5.59%. This further reinforces the conclusion that Tree House Education is overvalued in its current market position.