Is HealthStream, Inc. overvalued or undervalued?

As of 31 October 2025, the valuation grade for HealthStream, Inc. has moved from expensive to fair. The company appears to be fairly valued based on its current metrics. Key ratios include a P/E ratio of 46, an EV to EBITDA of 12.29, and a PEG ratio of 6.67, which suggest that while the company is not undervalued, it is also not excessively priced compared to its peers.
In comparison to its peers, HealthStream, Inc. has a P/E ratio of 40.95, which is lower than the significantly high P/E ratios of Enfusion, Inc. at 260.46 and Cerence, Inc. at 409.37, indicating a more reasonable valuation within the software products industry. However, the company has underperformed against the S&P 500 over multiple periods, with a year-to-date return of -18.14% compared to the S&P 500's 16.30%, which may reflect broader market trends or company-specific challenges.