Is Healthcare Services Group, Inc. overvalued or undervalued?

As of 24 October 2025, the valuation grade for Healthcare Services Group, Inc. has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently considered overvalued based on its metrics, with a P/E ratio of 25, an EV to EBITDA of 13.84, and a Price to Book Value of 2.09. In comparison, peers such as OPENLANE, Inc. and PagSeguro Digital Ltd. have P/E ratios of 23.96 and 8.20, respectively, highlighting the relative overvaluation of Healthcare Services Group.
Despite strong recent performance, with a year-to-date return of 59.19% compared to the S&P 500's 15.47%, the long-term outlook appears less favorable, as evidenced by a 5-year return of -21.65% versus the S&P 500's 95.99%. This suggests that while the stock has performed well recently, its high valuation may not be sustainable in the long run.