Is Medpace Holdings, Inc. overvalued or undervalued?

As of 3 September 2025, the valuation grade for Medpace Holdings, Inc. has moved from expensive to very expensive, indicating a significant concern regarding its valuation. The company appears to be overvalued, particularly when considering its P/E ratio of 21, which is notably higher than peers such as ICON plc with a P/E of 14.64 and Booz Allen Hamilton Holding Corp. at 15.81. Additionally, Medpace's EV to EBITDA ratio stands at 16.73, again exceeding the industry averages, which raises further doubts about its current valuation.
In comparison to the S&P 500, Medpace has shown impressive returns, with a YTD return of 51.08% compared to the index's 12.22%, and a remarkable 3Y return of 232.70% against 70.41% for the S&P 500. However, despite these strong performance metrics, the high valuation ratios suggest that the stock may not be a sustainable investment at its current price of 501.94.