FTI Consulting
FCN
$159.38
-2.85%
FTI Consulting, Inc. is a global business advisory firm providing professional services across corporate finance, forensic and litigation consulting, economic consulting, technology, and strategic communications. As a recognized leader in the consulting industry, FTI differentiates itself through its deep expertise in complex, high-stakes situations such as restructuring, disputes, and regulatory investigations, serving a diverse clientele across sectors like financial institutions, energy, and healthcare. The current investor narrative centers on the company's record earnings and strategic investments, as highlighted by a recent $183 million institutional bet signaling confidence despite a 16% one-year stock decline, with debate over whether the market's pessimism is overdone given the firm's robust financial performance.…
FCN
FTI Consulting
$159.38
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Investment Opinion: Should I buy FCN Today?
Rating: Hold. FTI Consulting offers a compelling forward valuation (PE 14.6x vs. industry 22x) and solid revenue growth (10.7% YoY), but the stock's persistent underperformance and margin pressures warrant caution. The average analyst target of $172 implies a modest 7.9% upside, which is not compelling enough for a Buy, but the low forward PE and institutional confidence suggest limited downside.
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FCN 12-Month Price Forecast
The AI assessment is neutral with medium confidence. FTI's fundamentals are solid, with accelerating revenue growth and a discounted forward valuation, but the stock's persistent underperformance and margin pressures create uncertainty. The market appears to be pricing in risks that may not materialize, but the lack of analyst coverage and negative beta add to the risk profile. An upgrade to bullish would require evidence of margin stabilization and improved price momentum, while a downgrade to bearish would be triggered by a significant earnings miss or continued margin deterioration.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on FTI Consulting's 12-month outlook, with a consensus price target around $176.00 and implied upside of +10.4% versus the current price.
Average Target
$176.00
0 analysts
Implied Upside
+10.4%
vs. current price
Analyst Count
—
covering this stock
Price Range
$172 - $180
Analyst target range
Analyst coverage is limited, with only 2 analysts providing targets, and the consensus recommendation is 'none' due to mixed ratings. The average target price is $172.00, implying a +7.9% upside from the current price of $159.38. The target range spans from $164.00 (low) to $180.00 (high), with the low target suggesting a modest 2.9% upside and the high target implying a 12.9% upside, indicating a relatively narrow spread of $16.00, which reflects moderate conviction. Institutional ratings show a recent downgrade by Truist Securities from Buy to Hold in October 2025, while Goldman Sachs maintains a Neutral stance, suggesting a cautious sentiment. The limited coverage and mixed ratings imply that FTI Consulting may be underfollowed, leading to potential inefficiencies in price discovery, but the recent $183 million institutional investment signals confidence in the company's long-term prospects despite near-term headwinds.
Bulls vs Bears: FCN Investment Factors
FTI Consulting presents a mixed picture: strong revenue growth and a compelling forward valuation are offset by persistent stock underperformance and margin pressure. The bull case is supported by accelerating growth, a low forward PE, and institutional confidence, while the bear case highlights weak price action, limited analyst support, and high PEG. Currently, the bull case has stronger evidence given the fundamental strength and valuation discount, but the key tension is whether the market will recognize this value or continue to penalize the stock due to margin trends and lack of coverage. The resolution of this tension will determine the stock's trajectory.
Bullish
- Accelerating Revenue Growth: Q4 2025 revenue grew 10.7% YoY to $990.7M, up from 8.9% in Q3 2025, showing accelerating momentum. Full-year revenue climbed from $898.3M in Q1 to $990.7M in Q4, indicating consistent sequential expansion.
- Undervalued on Forward PE: Forward PE of 14.6x is 34% below the industry average of 22x and 29% below its own trailing PE of 20.5x. This suggests the market is pricing in significant earnings growth, which is supported by EPS rising from $1.41 to $1.73 YoY.
- Strong Balance Sheet: Debt-to-equity is only 0.36, and current ratio is 1.56, indicating solid liquidity and low financial risk. This provides flexibility for strategic investments and resilience in downturns.
- Institutional Confidence: A recent $183 million institutional investment signals strong conviction despite the 16% one-year stock decline. This aligns with record earnings and suggests potential undervaluation.
Bearish
- Persistent Stock Underperformance: FCN is down 4.19% over one year and 8.75% over six months, while the S&P 500 gained 18.19% in the same period. Relative strength is -22.38% over one year, indicating significant underperformance.
- Limited Analyst Coverage and Mixed Ratings: Only 2 analysts cover the stock, with a 'none' consensus and a recent downgrade from Truist to Hold. This lack of coverage can lead to inefficiencies but also signals uncertainty.
- High PEG Ratio: PEG ratio of 4.41 suggests the stock is expensive relative to its growth rate, implying that the market's growth expectations may be too optimistic. This could lead to multiple compression if growth disappoints.
- Negative Beta and Idiosyncratic Risk: Beta of -0.043 means the stock is uncorrelated with the market, but this also implies that its performance is driven by company-specific factors, which can be unpredictable and lead to sharp moves.
FCN Technical Analysis
FTI Consulting's stock has been in a pronounced downtrend over the past year, with a 1-year price change of -4.19% and a 6-month change of -8.75%, significantly underperforming the S&P 500's +18.19% gain over the same period. The current price of $159.38 sits at 84.2% of its 52-week range (low $137.65, high $189.30), indicating the stock is closer to its lows than highs, which could suggest a value opportunity or a falling knife depending on fundamental support. The stock's beta of -0.043 implies it is virtually uncorrelated with market movements, a rare characteristic that may appeal to diversifying investors but also reflects idiosyncratic risk drivers.
Beta
-0.04
-0.04x market volatility
Max Drawdown
-24.9%
Largest decline past year
52-Week Range
$138-$189
Price range past year
Annual Return
-4.2%
Cumulative gain past year
| Period | FCN Return | S&P 500 |
|---|---|---|
| 1m | +6.7% | +0.3% |
| 3m | -8.3% | +4.0% |
| 6m | -8.8% | +8.3% |
| 1y | -4.2% | +20.2% |
| ytd | -6.4% | +9.6% |
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FCN Fundamental Analysis
FTI Consulting's revenue trajectory remains solid, with the most recent quarter (Q4 2025) reporting revenue of $990.7 million, a 10.7% year-over-year growth rate, and sequential growth from $956.2 million in Q3 2025. The company's revenue segments show Corporate Finance as the largest contributor at $423.2 million, followed by Forensic and Litigation Consulting at $192.9 million, Economic Consulting at $176.2 million, Strategic Communications at $99.4 million, and Technology at $99.0 million, indicating a diversified portfolio with Corporate Finance driving growth. This growth is accelerating, as Q4 2025's 10.7% YoY growth compares favorably to the prior year's Q4 2024 revenue of $894.9 million, and the full-year trend shows consistent expansion from $898.3 million in Q1 2025 to $990.7 million in Q4 2025.
Quarterly Revenue
$990746000.0B
2025-12
Revenue YoY Growth
+10.7%
YoY Comparison
Gross Margin
31.1%
Latest Quarter
Free Cash Flow
$166577000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is FCN Overvalued?
Given FTI Consulting's positive net income, the PE ratio is the primary valuation metric. The trailing PE is 20.5x, while the forward PE is 14.6x, indicating the market expects significant earnings growth, as the forward multiple is 29% lower than the trailing. This gap suggests optimism about future profitability, supported by the company's strong EPS growth from $1.41 in Q4 2024 to $1.73 in Q4 2025. Compared to the industry average PE of 22x (as per valuation data), FTI's trailing PE of 20.5x is at a 7% discount, while its forward PE of 14.6x is at a 34% discount, implying the stock is undervalued relative to peers on a forward basis. Historically, FTI's PE has ranged from 16.2x to 34.6x over the past five years, and the current trailing PE of 20.5x is near the lower end of this range, suggesting the stock is trading at a historically attractive valuation, potentially offering a margin of safety.
PE
20.5x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 15x~35x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
13.4x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks include moderate debt levels (D/E 0.36) and a high payout ratio of 0% (no dividend), which is not a concern but limits income appeal. Cash flow is positive with FCF of $166.6M TTM, but the high PCF ratio of 36.5x suggests the market is paying a premium for cash generation. Revenue concentration in Corporate Finance (43% of Q4 revenue) exposes the company to cyclicality in restructuring and M&A activity. Margin pressure is evident: gross margin fell from 32.25% in Q1 2025 to 31.05% in Q4 2025, and operating margin dropped from 12.31% to 9.43% over the same period, indicating rising costs that could erode profitability if not managed.
FAQ
The key risks include margin compression, as gross margin fell from 32.25% in Q1 2025 to 31.05% in Q4 2025, which could erode profitability. The stock's negative beta (-0.043) means it is uncorrelated with the market, so it may not benefit from market upswings and could be more volatile due to company-specific factors. Limited analyst coverage (only 2 analysts) increases information risk, and the recent downgrade by Truist signals caution. Additionally, the high PEG ratio of 4.41 suggests that if growth slows, the stock could face multiple compression. The most severe risk is a prolonged downturn in restructuring and M&A activity, which could lead to revenue declines and a drop to the 52-week low of $137.65.
The 12-month forecast is based on three scenarios: a bull case with a 30% probability, targeting $180-$189, driven by strong earnings growth and margin stabilization; a base case with a 50% probability, targeting $164-$172, assuming steady growth and stable margins; and a bear case with a 20% probability, targeting $137-$150, if margin pressures persist and growth decelerates. The most likely scenario is the base case, with the stock reaching the analyst average target of $172, implying a 7.9% upside. The key assumption is that revenue growth continues at a high single-digit to low double-digit rate and margins stabilize.
FCN appears undervalued on a forward basis, with a forward PE of 14.6x versus the industry average of 22x, a 34% discount. Its trailing PE of 20.5x is also below the industry average of 22x. Historically, the stock has traded between 16.2x and 34.6x, so the current trailing PE is near the lower end. The PEG ratio of 4.41 is high, suggesting that the market may be pricing in too much growth, but the forward PE indicates that earnings growth is expected to be strong. Overall, the stock is trading at a discount to peers and its own history, implying the market expects lower growth or higher risk.
FCN is a reasonable buy for investors with a medium-term horizon, given its forward PE of 14.6x, which is 34% below the industry average, and its accelerating revenue growth of 10.7% YoY. The average analyst target of $172 implies a 7.9% upside, which is modest but positive. However, the stock has underperformed the market significantly, and margin pressures could limit upside. It is a good buy for those who believe the market is overly pessimistic and that the company's growth will continue, but it is not a high-conviction buy given the limited analyst coverage and mixed ratings.
FCN is more suitable for long-term investment, given its growth trajectory and undervaluation on forward earnings. The stock's negative beta and high volatility (max drawdown -24.93%) make it less suitable for short-term trading. The company has no dividend, so investors rely on capital appreciation, which requires time for the market to recognize the value. A minimum holding period of 3-5 years is recommended to allow the growth story to play out and for the stock to potentially re-rate to its historical average PE. Short-term traders may find the stock challenging due to its idiosyncratic risk and lack of market correlation.