FORR
Forrester Research, Inc.
$10.00
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 22.7% below fair value
You pay
$10.00
Bear
$10.34
Fair
$12.93
Bull
$15.52
Bear
$10.34
+3.4%
$0.86 × 12x P/E
Fair
$12.93
+29.3%
$0.86 × 15x P/E
Bull
$15.52
+55.2%
$0.86 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
11.6x
Summary
Applying a 15x P/E to adjusted EPS of $0.86, the base-case value is $12.93 per share. DDM cross-check: $24.35.
Warnings
Dividend-based valuation: $24.35 (above our primary estimate by 88%). Large gaps may signal the dividend doesn't reflect full earning power.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples