Is Blackbaud, Inc. overvalued or undervalued?

As of 18 February 2025, the valuation grade for Blackbaud, Inc. has moved from fair to risky, indicating a significant deterioration in its financial standing. The company is currently assessed as overvalued, particularly given its troubling financial ratios. The Price to Book Value stands at an alarming 120.34, while the EV to EBITDA ratio is 19.61, both of which suggest that the stock price does not reflect the underlying value of the company. Additionally, the Return on Equity (ROE) is notably negative at -782.91%, further highlighting the company's struggles.
In comparison to its peers, Blackbaud's valuation metrics are concerning. For instance, Dun & Bradstreet Holdings, Inc. has a P/E ratio of 90.30, while Teradata Corp. is more favorably positioned with a P/E of 14.67, showcasing the disparity in valuation within the industry. The company's stock has underperformed relative to the S&P 500 over the past year, with a return of -14.74% compared to the index's 10.26%. These factors collectively reinforce the conclusion that Blackbaud, Inc. is overvalued in the current market environment.