Is Valaris Ltd. overvalued or undervalued?

As of 19 February 2025, the valuation grade for Valaris Ltd. has moved from attractive to fair, indicating a shift in market perception. The company is currently fairly valued based on its financial metrics. Key ratios include a P/E ratio of 9, an EV to EBITDA of 5.90, and a Price to Book Value of 1.34.
In comparison to peers, Valaris Ltd. has a P/E ratio of 10.54, which is higher than Helmerich & Payne, Inc. at 7.89 but lower than the risky Transocean Ltd. at -37.77. Notably, Valaris's ROCE stands at 16.92%, suggesting efficient capital use relative to its peers. Recent stock performance shows Valaris underperforming the S&P 500 over the past year, with a decline of 40.36% compared to the index's gain of 10.26%, reinforcing the notion of its current fair valuation.