FORR - Forrester Research: Margin Execution Would Drive Outperformance

2024-05-03 06:52:41 ET

Summary

• Forrester Research's share price has tumbled dramatically over the past 2 years, corresponding with their fundamental degradation.
• Sales have been impacted by short-term transition headwinds, largely driven by their transition to Forrester Decisions but should grow over time as this passes.
• Investors can earn good returns on capital if management can extract more operating leverage from the model, however, M&A and management risks lurk.

Introduction

The share price of Forrester Research (FORR) has seen quite the tumble over the past 24+ months, down nearly 70% from the start of 2022. Investors have been evidently displeased and looking at the numbers, it's not hard to see why. Notwithstanding some growth in 2022, both sales and earnings have been declining dramatically over the past year, with further declines in 2024....

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