Is WideOpenWest, Inc. overvalued or undervalued?

As of 23 February 2023, the valuation grade for WideOpenWest, Inc. has moved from expensive to risky, indicating a shift in perception regarding its financial health. Based on the available metrics, the company appears to be overvalued, particularly given its negative P/E ratio and low ROE of -30.26%. Key ratios include a Price to Book Value of 2.02, an EV to EBITDA of 5.69, and an EV to Sales of 2.27, which suggest that the company is not generating sufficient returns relative to its valuation.
In comparison to peers, WideOpenWest's EV to EBITDA ratio of 5.69 is more favorable than Shenandoah Telecommunications Co. at 12.52 and Altice USA, Inc. at 7.94, yet the negative P/E indicates significant underlying issues. The company's stock has underperformed against the S&P 500 over the longer term, with a 3-year return of -68.21% compared to the S&P 500's 70.41%, reinforcing the notion that it is currently overvalued.