Is NetScout Systems, Inc. overvalued or undervalued?

As of 24 October 2025, the valuation grade for NetScout Systems, Inc. has moved from attractive to fair. The company appears to be fairly valued based on its current metrics, with a P/E ratio of 36, an EV to EBITDA of 15.84, and a PEG ratio of 2.66. In comparison to peers, NetScout's P/E ratio is lower than that of Certara, Inc. at 150.54, but higher than the industry average, indicating a relative valuation challenge.
The company's recent performance shows a 1-year return of 31.23%, significantly outpacing the S&P 500's return of 16.90%, which suggests that investors have been rewarded for holding the stock in the short term. However, the longer-term returns over 3 years and 5 years indicate underperformance compared to the S&P 500, which may raise concerns about sustainability. Overall, while NetScout is currently fairly valued, the mixed performance against its peers and the broader market warrants cautious optimism.