Is AECOM overvalued or undervalued?

As of 5 August 2025, AECOM's valuation grade has moved from expensive to very expensive, indicating a significant shift in its market perception. The company appears overvalued based on its current metrics, particularly with a P/E ratio of 20, which is notably higher than its peers such as EMCOR Group, Inc. at 29.12 and Comfort Systems USA, Inc. at 38.72. Additionally, AECOM's EV to EBITDA stands at 13.73, while its peer average suggests a more favorable valuation for competitors.
Other relevant ratios include a Price to Book Value of 6.45 and a PEG Ratio of 0.16, which, despite being low, may not sufficiently justify the high valuation given the overall market context. AECOM has outperformed the S&P 500 across multiple time frames, with a 1-year return of 35.37% compared to the S&P 500's 17.14%, reinforcing the notion that while the stock has shown strong performance, its current valuation may not be sustainable.