RGP
Resources Connection, Inc.
$2.99
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 67.8% below fair value
You pay
$2.99
Bear
$7.44
Fair
$9.30
Bull
$11.16
Bear
$7.44
+148.8%
$0.62 × 12x P/E
Fair
$9.30
+211.0%
$0.62 × 15x P/E
Bull
$11.16
+273.2%
$0.62 × 18x P/E
Adjust Assumptions
15.0x
0.62$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
4.8x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$13.00
Divergence from AlphaVal
28%
Summary
Applying a 15x P/E to adjusted EPS of $0.62, the base-case value is $9.30 per share.
Warnings
Wall Street's average price target is $13.00 (from 18 analysts). Our estimate is 28% below the consensus -- consider that gap carefully.
This stock is 44% below its 52-week high, with weak or declining earnings. That combination often signals real trouble, even though the valuation below is based on other fundamentals.
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