Is Cass Information Systems, Inc. overvalued or undervalued?

As of 16 April 2025, the valuation grade for Cass Information Systems, Inc. has moved from very expensive to expensive, indicating a shift in perception regarding its market valuation. The company is currently considered overvalued. Key ratios include a P/E ratio of 31, a Price to Book Value of 2.69, and an EV to EBITDA of 10.74, all of which suggest that the stock is trading at a premium compared to its earnings and book value.
In comparison to peers, Cass Information Systems has a P/E ratio of 29.86, which is lower than HireRight Holdings Corp. at 57.62 but higher than Viad Corp. which has a negative P/E ratio of -16.40. This indicates that while Cass is less expensive than some peers, it still appears overvalued relative to its earnings potential. Additionally, the company's recent stock performance has lagged behind the S&P 500 over the past year, with a return of 4.74% compared to the index's 10.26%, reinforcing the notion of its overvaluation.