FORR
Forrester Research, Inc.
$6.76
Distressed or Transitioning
75%
Current FCF × Depressed Multiple
Moderate
·
Conviction
Fair Value
Trading 20.1% below fair value
You pay
$6.76
Bear
$6.60
Fair
$8.47
Bull
$10.33
Bear
$6.60
-2.4%
FCF continues to decline, 4x multiple
Fair
$8.47
+25.2%
Current FCF stabilizes, 6x multiple
Bull
$10.33
+52.8%
Credible recovery, multiple re-rates to 8x
Key Value Driver
Whether the core business model is intact or structurally impaired
Implied Market Multiple
4.2x
Summary
Stock is 42% below 52-week high. Using current FCF at a 6x depressed multiple, base-case value is $8.47. Wide scenario range: $6.60–$10.33.
Warnings
Don't assume past cash flow levels will return — the company's troubles may have permanently reduced its ability to generate profits.
A stock can look cheap on paper and still lose half its value if the underlying business is permanently damaged.
The wide range between our best and worst cases is intentional — pretending to know a precise value for a troubled company would be misleading.
Key Risks
- Bullish DCF projections are fundamentally unknowable for distressed companies
- M&A speculation can floor the stock above intrinsic value temporarily
- Management credibility is a key input — new CEO expands the bull case