Is Vertex, Inc. overvalued or undervalued?

As of 27 February 2025, Vertex, Inc. has moved from an attractive to a risky valuation grade, indicating a significant deterioration in its financial outlook. The company appears to be overvalued given its current metrics, particularly with a Price to Book Value of 32.47 and an EV to EBITDA of 63.24, which are substantially higher than those of its peers. Additionally, the company has a negative ROE of -17.81%, further supporting the notion of overvaluation.
In comparison to its peers, Compass, Inc. has a P/E ratio of -170.03 and Zeta Global Holdings Corp. has an EV to EBITDA of 86.43, both of which also reflect risky valuations. Notably, SolarWinds Corp. stands out with a more attractive P/E ratio of 25.03 and an EV to EBITDA of 13.67, showcasing a healthier financial position within the industry. Over the past year, Vertex, Inc. has underperformed against the S&P 500, with a return of -29.52% compared to the index's 17.14%, reinforcing the view that the stock is currently overvalued.