Is Charles River Laboratories International, Inc. overvalued or undervalued?

As of 7 May 2025, the valuation grade for Charles River Laboratories International, Inc. has moved from expensive to risky, indicating a shift in perception regarding its valuation. The company appears to be overvalued based on its current metrics, particularly with a P/E ratio of 22, which is significantly higher than peers like ICON plc at 14.64 and Booz Allen Hamilton Holding Corp. at 15.81. Additionally, the EV to EBITDA ratio stands at 10.30, which is also above the industry average, suggesting that the company may not be justifying its price relative to earnings.
In comparison to the S&P 500, Charles River Laboratories has underperformed significantly over multiple periods, with a year-to-date return of -14.96% compared to the index's 12.22%, and a staggering 10-year return of -28.51% against the S&P 500's 231.64%. This stark contrast reinforces the notion that the stock may be overvalued in the current market environment.