HubSpot (HUBS) Stock Still Looks Above Fair Value As Guidance Was Cut

HubSpot’s share price has fallen a long way over the past few years, yet the stock still screens as expensive on several valuation checks. This puts recent price moves under closer scrutiny for investors trying to judge whether the current level makes sense.

• Over the past 5 years, HubSpot shareholders have seen the stock decline 62.9%, which raises questions about how much of the earlier optimism has unwound in the current price.
• The recent reset in growth expectations after the latest company update can support a more measured outlook. However, any further disappointment around future revenue trends may continue to weigh on how much investors are willing to pay for the stock.
• With HubSpot scoring only 2 out of 6 on the broader valuation checks, the shares currently lean expensive rather than standing out as a clear bargain.

The issue now is whether HubSpot’s current valuation leaves enough room for a more supportive long term return profile after such a steep multi year share price decline.

Find out why HubSpot's -44.1% return over the last year is lagging behind its peers.

Is HubSpot Getting Expensive on Earnings?

The P/E ratio is a common way to judge how much you are paying for each dollar of HubSpot’s earnings. For a profitable software company such as HubSpot, it gives a quick sense of how confident the market is in its earnings profile.

HubSpot currently trades on a P/E of 81.7x, which is well above the Software industry average of 31.0x and also higher than the peer group average of 40.8x. A fair P/E based on the company’s profile is estimated at 48.6x. On this basis, the stock sits at a clear premium to what this framework suggests would be reasonable.

The recent Q2 2026 report beat earnings expectations, yet the stock dropped after guidance was cut. This shows the market is already sensitive to any change when the P/E is this elevated. At the current price, investors are paying a high multiple that leaves little margin for further disappointment in future earnings updates.

On this P/E multiple, HubSpot stock screens as overvalued compared with both industry norms and its own fair ratio estimate.

See what the numbers say about this price — find out in our valuation breakdown.

The HubSpot Narrative: What Would Justify Today's Price?

Simply Wall St Narratives for HubSpot pick up where this valuation puzzle leaves off and spell out what would need to happen to HubSpot's growth, margins and earnings for the stock to trade meaningfully above or below today's price on the Community page. Rather than leaning on a single multiple or model output, each narrative lays out the key assumptions behind its view of fair value so you can compare them with the company’s actual results over time.

Community views on HubSpot sit far apart, with one group arguing the stock underprices its SMB CRM position while another flags execution and AI related risks as still underappreciated.

Bull case: 27% undervalued

"HubSpot is a leading, product-led CRM platform for SMBs and mid-market companies that bundles marketing, sales, service, operations and commerce capabilities in an easy-to-adopt cloud suite..."

Read the full Bull Case to see why HubSpot could be undervalued

Bear case: 34% overvalued

"The small and medium business customer base that underpins HubSpot's growth may remain cautious in adopting advanced AI capabilities and multi-hub bundles, which could constrain upgrades..."

Read the full Bear Case to see why HubSpot could be overvalued

Do you think there's more to the story for HubSpot? Head over to our Community to see what others are saying!

The Bottom Line

For HubSpot, the current market multiple points to an overvalued stock, even after a difficult 5 year return profile. The high P/E suggests investors are still paying up for the story and leaving limited room for earnings or execution slips. With broader valuation checks also leaning weak, the key question now is whether HubSpot can deliver on growth and margin expectations strongly enough to justify that premium. The crux of the debate is how durable revenue momentum and adoption across its hubs prove to be from here.

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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