Is TruBridge, Inc. overvalued or undervalued?

As of 8 November 2023, TruBridge, Inc. has moved from an expensive to a risky valuation grade. The company appears to be overvalued, particularly given its negative return on equity of -5.10% and a price-to-book value of 2.14, which suggests that investors are paying a premium for the company's assets without corresponding profitability. Additionally, the EV to EBITDA ratio stands at 9.27, indicating a higher valuation compared to some peers.
In comparison to its peers, TruBridge's valuation metrics are concerning; for instance, MediaAlpha, Inc. has a P/E ratio of 14.78 and an EV to EBITDA of 11.08, while OneSpan, Inc. shows a more favorable EV to EBITDA of 8.43. These comparisons highlight that TruBridge is lagging behind its industry counterparts. Furthermore, while TruBridge has outperformed the S&P 500 over the past year with a return of 75.06% compared to 17.14%, its longer-term performance over three and five years shows significant underperformance, which reinforces the notion of overvaluation.