Is Valhi, Inc. overvalued or undervalued?

As of 7 November 2024, the valuation grade for Valhi, Inc. has moved from expensive to very attractive, indicating a significant shift in its perceived value. The company is currently considered undervalued, supported by a P/E ratio of 2, a price-to-book value of 0.40, and an EV to EBITDA ratio of 2.83. These metrics suggest that Valhi is trading at a substantial discount compared to its earnings and asset values.
In comparison to its peers, Valhi's P/E ratio is markedly lower than that of Proto Labs, Inc., which stands at 44.27, and Compass Minerals International, Inc., which has a negative P/E ratio of -11.67. Additionally, Valhi's EV to EBITDA ratio of 2.83 is significantly more favorable than Proto Labs' 13.86. Despite recent underperformance relative to the S&P 500 over the past year, the current valuation metrics indicate that Valhi, Inc. presents a compelling investment opportunity.