Is Masimo Corp. overvalued or undervalued?

As of 25 February 2025, the valuation grade for Masimo Corp. has moved from expensive to risky, indicating a shift in perception regarding its market valuation. The company appears to be overvalued given its high P/E ratio of 409, a Price to Book Value of 12.86, and an EV to EBITDA of 73.89. In comparison, peers like QIAGEN NV and Bio-Rad Laboratories, Inc. have much lower P/E ratios of 24.20 and 16.20, respectively, suggesting that Masimo Corp. is priced significantly higher than its industry counterparts.
Recent performance metrics further support the overvaluation narrative, with Masimo Corp. showing negative returns across multiple periods, including a YTD return of -13.49% compared to the S&P 500's 12.22%. This stark contrast highlights the company's struggles in delivering value to shareholders relative to broader market performance.