Is Select Medical Holdings Corp. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Select Medical Holdings Corp. has moved from attractive to very expensive, indicating a shift towards overvaluation. The company appears overvalued based on its current metrics, with a P/E ratio of 8, an EV to EBITDA ratio of 6.47, and a Price to Book Value of 1.15. In comparison to peers, Universal Health Services, Inc. has a higher P/E of 9.20, while Surgery Partners, Inc. has an EV to EBITDA of 8.44, suggesting that Select Medical is trading at a lower valuation relative to some competitors despite its high valuation grade.
Additionally, Select Medical's recent stock performance has been underwhelming, with a year-to-date return of -28.97% compared to the S&P 500's 13.30%, and a one-year return of -27.49% versus the S&P 500's 14.08%. This underperformance reinforces the notion that the stock may be overvalued in the current market context.