| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 405.96 | 4030 |
| Intrinsic value (DCF) | 5.24 | -47 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 0.43 | -96 |
Forrester Research, Inc. (NASDAQ: FORR) is a leading independent research and advisory firm that empowers business and technology leaders with data-driven insights to drive customer obsession and sustainable growth. Operating across three core segments—Research, Consulting, and Events—Forrester delivers actionable intelligence through subscription-based research, strategic consulting, and industry-leading events. The company specializes in market forecasts, consumer insights, vendor evaluations, and operational benchmarking, serving clients globally across industries such as technology, marketing, and risk management. Headquartered in Cambridge, Massachusetts, Forrester has built a reputation for its forward-looking analysis and thought leadership in digital transformation, customer experience (CX), and sales enablement. Despite macroeconomic headwinds, Forrester remains a key player in the $300B+ global consulting and advisory market, competing with legacy firms and disruptive analytics platforms. Its asset-light model and recurring revenue base provide resilience, though profitability challenges persist amid rising competition.
Forrester Research presents a mixed investment profile. The company’s niche expertise in CX and tech advisory offers differentiation, and its subscription-based Research segment (75% of revenue) provides recurring income. However, declining profitability (FY2023 net loss of $5.7M) and negative operating cash flow ($-3.9M) raise concerns about execution. While the stock’s low beta (0.95) suggests lower volatility versus the market, the lack of dividends and modest market cap ($203M) limit appeal to growth-focused investors. Key upside catalysts include expansion of high-margin digital research products and cross-selling consulting services, but risks include competition from lower-cost analytics platforms and reliance on corporate IT budgets. Valuation appears reasonable at 0.47x revenue, but investors should monitor margin improvement and client retention rates.
Forrester competes in the fragmented research and advisory space by combining proprietary methodologies (e.g., Forrester Wave™ vendor assessments) with a consultative approach. Its primary competitive advantage lies in CX and B2B marketing/sales research—domains where it outperforms generalist firms through specialized frameworks like SiriusDecisions’ demand waterfall. However, the company faces mounting pressure from three fronts: (1) Premium competitors (Gartner, IDC) with broader IT research coverage and larger salesforces, (2) Niche players (Qualtrics, Medallia) offering specialized CX analytics tools, and (3) Disruptors (G2, TrustRadius) providing crowd-sourced vendor reviews at lower cost. Forrester’s hybrid model (research + consulting) creates cross-selling opportunities but risks dilution of focus. The firm’s 2023 pivot toward AI-driven insights (e.g., Generative AI for CX predictions) is a timely differentiator, though implementation lags behind tech-native rivals. Geographic reach remains a weakness—only 35% of revenue comes from outside North America versus 50%+ for Gartner—limiting exposure to high-growth APAC markets. Client retention rates (~70%) trail industry leaders, suggesting vulnerability in enterprise renewals.