BBSI
Barrett Business Services, Inc.
$31.52
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 21.6% below fair value
You pay
$31.52
Bear
$33.70
Fair
$40.21
Bull
$46.12
Bear
$33.70
+6.9%
4% stage 1 growth, 11% discount
Fair
$40.21
+27.6%
7% stage 1 growth, 11% discount
Bull
$46.12
+46.3%
9% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
36%
Implied Market Multiple
13.6x
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $46.00 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $40.21 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions