Is HealthStream, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for HealthStream, Inc. has moved from very attractive to fair, indicating a shift in its perceived value. Based on the current metrics, the company appears to be overvalued. Key ratios include a P/E ratio of 46, an EV to EBITDA of 12.29, and a Price to Book Value of 2.40, which are relatively high compared to its peers. For instance, Pagaya Technologies Ltd. has a P/E ratio of 71.76, while Couchbase, Inc. shows a negative P/E, highlighting the mixed performance within the sector.
In terms of performance, HealthStream has underperformed against the S&P 500 over various periods, notably with a year-to-date return of -16.54% compared to the S&P 500's 13.30%. This underperformance, along with its high valuation ratios, suggests that the stock may not be a compelling investment at its current price level.