Is Unusual Machines, Inc. overvalued or undervalued?

As of 14 August 2024, the valuation grade for Unusual Machines, Inc. has moved from does not qualify to risky, indicating a significant shift in perceived financial health. The company appears to be overvalued given its current metrics, particularly with a Price to Book Value of 11.59 and an EV to Sales ratio of 25.66, which are notably high considering the company's negative earnings and substantial losses reflected in its ROCE of -82.99% and ROE of -57.49%.
When compared to peers, Unusual Machines, Inc. has a P/E ratio of -21.05 and an EV to EBITDA of -18.23, which suggests that it is underperforming relative to its industry. The stock has shown a remarkable return of 603.16% over the past year, significantly outperforming the S&P 500's return of 17.14%, but this high return may not be sustainable given the company's financial challenges. Overall, the combination of high valuation ratios and poor profitability metrics leads to the conclusion that Unusual Machines, Inc. is overvalued.