Is Healthcare Services Group, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Healthcare Services Group, Inc. has moved from attractive to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued, with a P/E ratio of 25, which is substantially higher than its peers, such as OPENLANE, Inc. at 23.96 and PagSeguro Digital Ltd. at 8.20. Additionally, the EV to EBITDA ratio stands at 13.84, compared to OPENLANE's 11.43, further highlighting the premium valuation of Healthcare Services Group.
In terms of performance, the company has shown strong short-term returns, with a year-to-date return of 40.77% compared to the S&P 500's 13.30%. However, over a longer horizon, such as the past three years, the company has underperformed with a return of 26.55% against the S&P 500's 81.19%. This disparity in performance, combined with its elevated valuation ratios, reinforces the conclusion that Healthcare Services Group, Inc. is currently overvalued.