Guardian Pharmacy Services (GRDN): Assessing Valuation After Strong Q3 Results and Upgraded 2025 Outlook

Guardian Pharmacy Services (GRDN) stock saw renewed attention after the company reported a strong third quarter, boosted by a 20% jump in revenue and a notable rise in residents served. Management not only exceeded expectations but also raised their outlook for 2025, highlighting momentum from recent acquisitions in the Pacific Northwest.

See our latest analysis for Guardian Pharmacy Services.

Guardian’s upbeat earnings report and expansion into new markets seem to have supercharged investor sentiment, with the stock grabbing a 19.7% share price return over the past month and an impressive 46.9% share price return year to date. Momentum appears to be building as management continues to deliver positive surprises and strategic acquisitions.

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With shares rallying on the back of strong execution and raised guidance, investors now face the critical question: Is Guardian Pharmacy Services still undervalued, or is the market already factoring in the company’s future growth opportunities?

Price-to-Earnings of 46x: Is it justified?

Guardian Pharmacy Services trades at a price-to-earnings (P/E) ratio of 46x, placing it below the average of its closest peers but notably higher than the broader healthcare sector. The last close price of $29.21 suggests investors are currently willing to pay a premium for Guardian’s forecast earnings.

The P/E ratio reflects how much investors are paying for each dollar of earnings, making it a popular tool for comparing profitability across companies in the same industry. A higher P/E ratio can imply high growth expectations, while a lower ratio might suggest undervaluation or market caution.

Guardian’s P/E ratio is lower than its peer group average of 54.4x, signaling relative value among direct competitors. However, compared to the US Healthcare industry’s average P/E of 22x, Guardian appears expensive. In addition, the stock’s P/E far exceeds the fair price-to-earnings ratio estimate of 25x, indicating the current valuation leaves little room for disappointment should growth slow.

Explore the SWS fair ratio for Guardian Pharmacy Services

Result: Price-to-Earnings of 46x (OVERVALUED)

However, a slowdown in annual revenue growth and a premium price near recent highs could challenge the bullish narrative if future results disappoint.

Find out about the key risks to this Guardian Pharmacy Services narrative.

Another View: Discounted Cash Flow Perspective

While the P/E ratio paints Guardian as expensive, the SWS DCF model tells a more balanced story. According to this approach, Guardian’s share price of $29.21 is almost exactly in line with its estimated fair value of $29.05. This suggests the market may already be pricing in future growth.

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Guardian Pharmacy Services for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 879 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Guardian Pharmacy Services Narrative

If you have a different perspective or want to dive into the numbers yourself, it's easy to analyze the figures and shape your own view in just a few minutes. Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Guardian Pharmacy Services.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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