Is Morningstar, Inc. overvalued or undervalued?

As of 24 July 2024, the valuation grade for Morningstar, Inc. has moved from expensive to very expensive. This indicates that the company is overvalued. Key ratios reveal a P/E ratio of 42, a Price to Book Value of 10.36, and an EV to EBITDA of 26.18, all suggesting a high valuation relative to earnings and book value.
In comparison to peers, Morningstar's P/E ratio of 40.59 is significantly higher than Northern Trust Corp.'s fair valuation P/E of 11.61, and Corebridge Financial's very expensive P/E of 34.60. The PEG ratio of 0.56 does indicate some growth potential, but it does not sufficiently offset the high valuation metrics. Additionally, while Morningstar's stock has shown a 3.97% return over the past year, it lags behind the S&P 500's 10.26% return, reinforcing the notion that the stock may be overvalued in the current market context.