Critical Contrast: Resources Connection (NASDAQ:RGP) and Forrester Research (NASDAQ:FORR)

Resources Connection (NASDAQ:RGP) and Forrester Research (NASDAQ:FORR) are both small-cap industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, profitability, earnings, risk, institutional ownership and valuation.

Profitability

This table compares Resources Connection and Forrester Research’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Resources Connection	-8.98%	-4.63%	-3.16%
Forrester Research	-11.17%	6.19%	1.93%

Volatility & Risk

Resources Connection has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500. Comparatively, Forrester Research has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500.

Institutional & Insider Ownership

93.2% of Resources Connection shares are held by institutional investors. Comparatively, 55.2% of Forrester Research shares are held by institutional investors. 7.9% of Resources Connection shares are held by insiders. Comparatively, 40.7% of Forrester Research shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Resources Connection and Forrester Research”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Resources Connection	$452.01 million	0.34	-$40.60 million	($1.20)	-3.68
Forrester Research	$396.89 million	0.56	-$119.36 million	($2.25)	-5.23

Resources Connection has higher revenue and earnings than Forrester Research. Forrester Research is trading at a lower price-to-earnings ratio than Resources Connection, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Resources Connection and Forrester Research, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Resources Connection	1	1	2	0	2.25
Forrester Research	1	1	0	0	1.50

Resources Connection presently has a consensus price target of $7.00, indicating a potential upside of 58.37%. Given Resources Connection’s stronger consensus rating and higher possible upside, analysts clearly believe Resources Connection is more favorable than Forrester Research.

Summary

Resources Connection beats Forrester Research on 9 of the 14 factors compared between the two stocks.

About Resources Connection

Resources Connection, Inc. provides consulting services to business customers under the Resources Global Professionals name in North America, Europe, and the Asia Pacific. The company offers services in the areas of transactions, including integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; and regulations, such as accounting regulations, internal audit and compliance, data privacy and security, healthcare compliance, and regulatory compliance. It provides transformations services comprising finance transformation, digital transformation, supply chain management, cloud migration, and data design and analytics. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.

About Forrester Research

Forrester Research, Inc. operates as an independent research and advisory company in the United States and internationally. The company operates in three segments: Research, Consulting, and Events. The Research segment primary subscription research services include Forrester Decisions, Forrester Research, and SiriusDecisions Research, which are designed to provide business and technology leaders with a proven path to growth through customer obsession. This segment delivers content, such as future trends, predictions, and market forecasts; deep consumer and business buyer data and insights; curated best practice models and tools to run business functions; operational and performance benchmarking data; and technology and service market landscapes and vendor evaluations. The Consulting segment provides consulting projects, include conducting maturity assessments, prioritizing best practices, developing strategies, building business cases, selecting technology vendors, structuring organizations, developing content marketing strategies and collateral, and sales tools; and advisory services. The Events segment hosts events related to business-to-business marketing, sales and product leadership, customer experience, security and risk, new technology and innovation, and data strategies and insights. The company sells its products and services through direct sales force in various locations. Forrester Research, Inc. was incorporated in 1983 and is headquartered in Cambridge, Massachusetts.