Is Pegasystems, Inc. overvalued or undervalued?

As of 17 October 2025, Pegasystems, Inc. has moved from a very expensive to a fair valuation grade. The company is currently fairly valued based on its financial metrics. Key ratios include a P/E ratio of 44, an EV to EBITDA of 28.79, and a PEG ratio of 0.84, indicating that the stock is reasonably priced relative to its growth potential.
In comparison to peers, CACI International, Inc. has a more attractive P/E ratio of 39.26, while Parsons Corp. stands at a fair valuation with a P/E of 35.78. Notably, Pegasystems has outperformed the S&P 500 over the past year with a return of 45.21% compared to the index's 14.08%, although it has underperformed over longer periods, particularly in the 3Y and 5Y returns.