Is Upwork, Inc. overvalued or undervalued?

As of 5 May 2025, Upwork, Inc. has moved from a very attractive to an attractive valuation grade. The company is currently considered undervalued, with a P/E ratio of 9, which is significantly lower than its peer Korn Ferry at 20.72 and Perficient, Inc. at 34.11. Additionally, Upwork's EV to EBITDA stands at 16.10, while Korn Ferry's is at 10.49, indicating that Upwork is trading at a discount relative to some of its peers despite its strong ROE of 39.52% and ROCE of 27.34%.
In comparison to the broader market, Upwork's recent stock performance has been underwhelming, with a year-to-date return of -20.06% compared to the S&P 500's 2.44%. This underperformance, coupled with its attractive valuation metrics, suggests that the market may not fully recognize Upwork's potential, reinforcing the view that it is undervalued at its current price of $13.07.