Forrester's Research Bookings Should Improve In 2H23, Says Analyst

Barrington Research analyst Vincent Colicchio reiterated an Outperform rating on the shares of Forrester Research Inc FORR and lowered the price target from $48 to $39.
The company reported Q4/22 non-GAAP EPS of $0.45, which exceeded the analyst’s forecast of $0.34 and the FactSet consensus forecast of $0.33.
The non-GAAP EPS upside versus the analyst’s forecast was primarily due to a gross margin overage of 150 bps and a selling, general and administrative (SG&A) cost shortfall of 4%, which more than offset a 2% revenue shortfall.
Revenue of $136.9 million was 2% less than the analyst’s forecast and 1% less than the FactSet consensus forecast.
The research subscription business, represented by Contract Value (CV), grew 3% YOY in constant currency in Q4/22, down four points from the prior quarter on economic headwinds, small client losses and transition challenges, the analyst said.
The analyst believes that the actions planned by management, including better sales force targeting of senior executives, should enable CV growth to improve in the second half of 2023.
The analyst reduced 2023 non-GAAP EPS forecast to $2.35 from $2.48 (mainly on lower revenue and adjusted operating margins) and introduced an initial 2024 non-GAAP EPS forecast of $2.72.
Price Action: FORR shares are trading higher by 3.93% at $33.04 on the last check Monday.

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