Why Advisory Board Is Poised to Pull Back

Brian D. Pacampara, The Motley Fool
Updated

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, business research provider Advisory Board has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Advisory Board and see what CAPS investors are saying about the stock right now.

Advisory Boardfacts

Headquarters (Founded)

Washington, D.C. (1979)

Market Cap

$1.8 billion

Industry

Research services

Trailing-12-Month Revenue

$413.8 million

Management

CEO Robert Musslewhite (since 2008)
CFO Michael Kirshbaum (since 2006)

Return on Equity (Average, Past 3 YTears)

13.2%

Cash/Debt

$95.2 million / $0

Competitors

Accenture
Huron Consulting
Navigant Consulting


Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 76% of the 74 members who have rated Advisory Board believe the stock will underperform the S&P 500 going forward.

Earlier this month, one of those Fools, All-Star MMCapitalMgmt, wrote that the Advisory Board bear case all boiled down to price:

Ridiculously overvalued. Trading at 25x EV/EBITDA, 4x EV/Rev, 7x book value, 4x sales, 64x trailing earnings, 33x forward earnings. Come on now, this isn't a premium company.

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The article Why Advisory Board Is Poised to Pull Back originally appeared on Fool.com.

Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Accenture. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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