The retailer is overdiscounting its merchandise/prices.
… lack of knowledge caused the general marketplace to overdiscount its nonperformers … Sanford Rose
… market participants may overdiscount for the effects of uncertainty … Edmund L. Jenkins
2
transitive: to give too little weight or consideration to (something)
… we overdiscount the power of social media over our lives. Brady Dale
Both are examples of the human tendency to overdiscount future events. In both impatience and procrastination, we overweight the immediate. Frank Partnoy
As Professor [Samuel] Issacharoff notes, lawyers "may tend to overdiscount the likelihood of eventual punishment, thus undermining the deterrent function of the prescribed penalty." Michelle M. Kwon