Is Psychemedics Corp. overvalued or undervalued?

As of 29 March 2022, the valuation grade for Psychemedics Corp. moved from fair to risky, indicating a deterioration in its financial outlook. The company appears to be overvalued, given its negative performance metrics and ratios. The Price to Book Value stands at 2.93, while the EV to EBITDA ratio is 14.29, and the EV to Sales ratio is 0.73, all suggesting a lack of profitability and high valuation relative to sales.
In comparison to its peers, Psychemedics Corp. has a significantly lower EV to EBITDA ratio than Accolade, Inc. at -13.44 and Community Health Systems, Inc. at 8.02, indicating that it is struggling more than its competitors. Additionally, the company's recent stock performance has been poor, with a one-year return of -8.88%, compared to the S&P 500's return of 17.14%, reinforcing the notion that it is overvalued in the current market context.