Is Waaree Energies overvalued or undervalued?

As of 1 December 2024, Waaree Energies has moved from a grade of "does not qualify" to "very expensive." The company is currently overvalued based on its high valuation metrics, including a PE ratio of 45.62, an EV to EBITDA ratio of 32.51, and an EV to Sales ratio of 6.10. These figures suggest that the stock is trading at a significant premium compared to its earnings and sales.
In comparison to its peers, Waaree Energies has a higher PE ratio than both Suzlon Energy Ltd. at 43.7 and Premier Energies at 50.76, indicating that investors are paying more for each unit of earnings. Additionally, the company's EV to EBITDA ratio of 32.51 is also elevated compared to the industry average. Despite a recent uptick in stock performance over the past month, with an 8.15% return compared to the Sensex's 3.80%, the overall valuation suggests that Waaree Energies is not a favorable investment at this time.