Is InnovAge Holding Corp. overvalued or undervalued?

As of 13 September 2022, the valuation grade for InnovAge Holding Corp. changed from attractive to risky, indicating a shift towards a more negative outlook. The company appears to be overvalued given its current financial metrics, particularly with a Price to Book Value of 2.28 and an EV to EBITDA ratio of 25.90, which are concerning in the context of its negative earnings and return metrics. Additionally, the EV to Sales ratio of 0.62 suggests that the market may be pricing in expectations that are not being met by actual performance.
In comparison to its peers, InnovAge Holding Corp. has a significantly worse EV to EBITDA ratio than Everbridge, Inc. at 99.6860 and NeoGames SA at 33.0367, both of which are also classified as risky. This further reinforces the notion that InnovAge is not only underperforming relative to its industry but also facing substantial challenges. Despite a recent 1-month stock return of 43.63% compared to the S&P 500's 2.33%, the longer-term performance shows a decline of 15.36% over the past year, suggesting that the recent uptick may not be sustainable.