Is Comfort Systems USA, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Comfort Systems USA, Inc. has moved from very expensive to expensive, indicating a shift in perception regarding its valuation. The company appears to be overvalued based on its current metrics, with a P/E ratio of 31, a Price to Book Value of 11.59, and an EV to EBITDA ratio of 21.24. In comparison, peers such as EMCOR Group, Inc. have a P/E ratio of 29.12 and an EV to EBITDA of 19.49, while AECOM shows a P/E of 22.09 and an EV to EBITDA of 14.87, highlighting that Comfort Systems is trading at a premium relative to its industry counterparts.
Despite the overvaluation, Comfort Systems has demonstrated impressive returns, with a year-to-date return of 95.24% compared to the S&P 500's 13.30%, and a staggering 691.81% return over three years against the S&P 500's 81.19%. This strong performance may suggest that market sentiment is driving the stock price higher, but the valuation metrics indicate that it may not be sustainable at these levels.