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ParsonsPSN +3.66%76 Debt-to-EBITDA is 3.15 as of Mar. 2026, which is 25% above its 10-year median of 2.51. GuruFocus rates PSN with a GF Score™ of 76/100 and a GF Value™ of $81.23 (Significantly Undervalued). The stock has 2 warning signs investors should review. Among 1,720 Software companies, Parsons ranks worse than 75.87% on this metric.
Debt-to-EBITDA measures a company's ability to pay off its debt.
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
The historical rank and industry rank for Parsons's Debt-to-EBITDA or its related term are showing as below:
PSN'
s Debt-to-EBITDA Range Over the Past 10 Years
Min: 1.23 Med: 2.51 Max: 3.09
Current: 3.09
During the past 10 years, the highest Debt-to-EBITDA Ratio of Parsons was 3.09. The lowest was 1.23. And the median was 2.51.
PSN's Debt-to-EBITDA is ranked worse than 75.87% of 1720
companies
in the Software industry
Industry Median: 1.085
vs PSN: 3.09
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.
According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
Parsons Debt-to-EBITDA Related Terms
Parsons Debt-to-EBITDA Historical Data
* Premium members only.
The historical data trend for Parsons's Debt-to-EBITDA can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Information Technology Services subindustry, Parsons's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Parsons Debt-to-EBITDA vs Software Industry
For the Software industry and Technology sector, Parsons's Debt-to-EBITDA distribution charts can be found below:
* The bar in red indicates where Parsons's Debt-to-EBITDA falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data,
the EBITDA data used here is four times the quarterly (Mar. 2026) EBITDA data.
Parsons (PSN) has a Debt-to-EBITDA of 3.15 as of Mar. 2026. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Parsons. This is 25% above median its historical median of 2.51. Over the past decade, Parsons' Debt-to-EBITDA has ranged from 1.23 to 3.09. According to the industry distribution chart, Parsons ranks #1305 out of 1720 companies in the Software industry, placing it in the top 75.9%.
Is Parsons' Debt-to-EBITDA too high?
Parsons' current Debt-to-EBITDA of 3.15 is 25% above median its 10-year median of 2.51. Over the past 10 years, this metric has ranged from a low of 1.23 to a high of 3.09. The Software industry median Debt-to-EBITDA is 1.09. Parsons' value of 3.15 is 190.3% above this industry median. Based on the distribution chart, Parsons ranks #1305 out of 1720 companies in the Software industry, which is in the bottom quartile relative to peers. Overall, Parsons has a GF Score™ of 76/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Parsons' Debt-to-EBITDA compare to GDS and G?
According to the Software industry distribution chart, Parsons ranks #1305 out of 1720 companies for Debt-to-EBITDA. This places Parsons in the lower half of its industry. The industry median Debt-to-EBITDA is 1.09. Parsons' value of 3.15 is 190.3% above this benchmark. Historically, Parsons' own Debt-to-EBITDA has ranged from 1.23 to 3.09 over the past decade. While the company's 10-year median is 2.51 vs. the industry median of 1.09, Parsons has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Debt-to-EBITDA for a Software company?
The median Debt-to-EBITDA among Software companies is 1.09, based on 1,720 companies in the industry. Companies in the top quartile (top 25%) have a Debt-to-EBITDA significantly above this median, while those in the bottom quartile fall well below. However, Debt-to-EBITDA should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Parsons's current Debt-to-EBITDA of 3.15 is 190.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Debt-to-EBITDA mean?
A high Debt-to-EBITDA can signal that a stock is expensive relative to its fundamentals. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Parsons. For the Software industry, the median Debt-to-EBITDA is 1.09 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Parsons's current Debt-to-EBITDA is 3.15, which is 25% above median its own 10-year median of 2.51. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Parsons stock overvalued right now?
Based on GuruFocus' analysis, Parsons (PSN) is currently considered Significantly Undervalued. The stock's GF Value™ is $81.23, compared to a current price of $57.20 — trading 29.6% below its estimated fair value. The current Debt-to-EBITDA is 3.15, which is 25% above median its 10-year median of 2.51 and 190.3% above the Software industry median of 1.09. Parsons' overall GF Score™ is 76/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Debt-to-EBITDA calculated?
Debt-to-EBITDA is calculated from a company's financial statements. For Parsons (PSN), the current Debt-to-EBITDA is 3.15 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Parsons (PSN) Overvalued in 2026?
Based on GuruFocus' analysis, Parsons stock appears to be undervalued.
The current stock price of $57.20 is trading 29.6% below its estimated GF Value™ of $81.23.
GuruFocus considers Parsons to be Significantly Undervalued.
Key valuation signals for PSN:
Debt-to-EBITDA: 3.15 (25% above median its 10-year median of 2.51)
GF Value™: $81.23 vs. price of $57.20 (29.6% below fair value)
Industry Position: 190.3% above the Software median (#1305 of 1720)
No single metric tells the full story. See the PSN stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Parsons Corp is a provider of technology-driven solutions in the defense, intelligence, and critical infrastructure markets. The business activities of the group are carried out through Federal Solutions and Critical Infrastructure segments. The Federal Solutions segment is a high-end service and technology provider to the U.S. government, delivering timely, cost-effective solutions for mission-critical projects, whereas the Critical Infrastructure segment provides integrated design and engineering services for complex physical and digital infrastructure around the globe. The company derives maximum revenue from Federal Solutions segment. Geographically, the company derives revenue from North America; Middle East; and Rest of the World, of which North America derives maximum revenue.
76GF Score
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