Is DLH Holdings Corp. overvalued or undervalued?

As of 17 October 2025, the valuation grade for DLH Holdings Corp. has moved from attractive to fair, indicating a shift in its perceived value. The company appears to be fairly valued based on its current metrics, with a P/E ratio of 15, a Price to Book Value of 0.70, and an EV to EBITDA of 5.72. In comparison, Kforce, Inc. has a significantly higher P/E ratio of 49.41, while Kelly Services, Inc. shows a lower P/E of 5.57, highlighting the mixed valuation landscape within its peer group.
Despite its fair valuation, DLH Holdings Corp. has underperformed relative to the S&P 500, with a year-to-date return of -31.51% compared to the index's 13.30%. This stark contrast in performance over multiple periods, including a 5-year return of -41.8% versus 91.29% for the S&P 500, suggests that while the stock may be fairly valued, it has not delivered returns that align with broader market expectations.