Is Addus HomeCare Corp. overvalued or undervalued?

As of 16 May 2025, the valuation grade for Addus HomeCare Corp. has moved from expensive to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued, with a P/E ratio of 23, which is slightly above the peer average of approximately 22.93. Additionally, the EV to EBITDA ratio stands at 16.07, again higher than the peer average of 16.196, and the PEG ratio is at 1.38, suggesting that the stock may not be justified by its growth prospects.
In comparison to its peers, Addus HomeCare Corp. is lagging behind in terms of return metrics, with a ROCE of 11.05% and ROE of 9.19%, which are relatively modest. Notably, while the stock has underperformed against the S&P 500 on a year-to-date basis, returning -9.84% compared to the index's 2.44%, this trend reinforces the notion that the stock is currently overvalued in the market.