Is Astrana Health, Inc. overvalued or undervalued?

As of 7 July 2025, the valuation grade for Astrana Health, Inc. has moved from expensive to very expensive, indicating a significant concern regarding its current valuation. The company appears to be overvalued, with a P/E ratio of 36, which is considerably higher than its peers, such as Premier, Inc. at 11.29 and Select Medical Holdings Corp. at 7.26. Additionally, its EV to EBITDA ratio stands at 14.41, further highlighting the elevated valuation compared to industry standards.
In terms of financial performance, Astrana Health, Inc. has a ROCE of 8.80% and a ROE of 5.30%, which do not justify its high valuation metrics. The stock has underperformed against the S&P 500 across multiple periods, with a YTD return of -5.52% compared to the index's 12.22%, and a staggering 1-year return of -47.88% versus 17.14% for the S&P 500. This underperformance reinforces the notion that the stock is overvalued in the current market environment.