Is Five9, Inc. overvalued or undervalued?

As of 5 August 2025, the valuation grade for Five9, Inc. moved from expensive to attractive, indicating a more favorable assessment of its valuation. Despite this positive shift, the company appears to be overvalued based on its current P/E ratio of 316, which is significantly higher than the industry average, and a PEG ratio of 2.84, suggesting that growth expectations may not justify the high price. Additionally, Five9's EV to EBITDA stands at 19.00, which also raises concerns about its valuation relative to peers. In comparison to its peers, Five9, Inc. has a P/E ratio of 117.34, while Duolingo, Inc. is considered very expensive at 104.90, and Qualys, Inc. is attractive at 25.97. The stark contrast in valuation ratios highlights Five9's premium pricing in the market. Over the past year, Five9's stock has returned -6.80%, underperforming the S&P 500's return of 17.14%, further reinforcing the notion that the stock may be overvalued given its lackluster performance relative to broader market trends.