Is Verisk Analytics, Inc. overvalued or undervalued?

As of 21 February 2025, the valuation grade for Verisk Analytics, Inc. has moved from expensive to very expensive, indicating a significant increase in perceived valuation. The company is currently overvalued, with a P/E ratio of 174, a Price to Book Value of 1357.58, and an EV to EBITDA ratio of 106.63. These ratios are substantially higher than those of peers such as Netflix, Inc., which has a P/E of 57.44 and an EV to EBITDA of 20.28, and Automatic Data Processing, Inc., with a P/E of 47.94 and an EV to EBITDA of 32.84.
The high valuation metrics suggest that investors are paying a premium for Verisk Analytics compared to its peers, reinforcing the conclusion that the stock is overvalued. Despite a strong return of 14.09% over the past year compared to the S&P 500's 10.26%, the excessive valuation ratios indicate that the stock may not be a prudent investment at its current price of 308.41.