Bellwether Research Valuations Increased in Q1 2017


According to analysis prepared exclusively for Integrity Research by Marlin & Associates[1], the international M&A advisor, in the first quarter of 2017 average valuations for large publicly traded research and information firms increased to 4.8x trailing 2016 actual revenues, compared to 4.3x 2016 revenue last quarter.  Average EBITDA multiples also increased to 15.2x trailing 2016 EBITDA relative to last quarter’s value of 13.4x for 2016 EBITDA.

Marlin & Associates has prepared these special valuation benchmarks for the investment research industry in collaboration with Integrity Research Associates. The benchmarks monitor the valuations for publicly traded firms that offer research-related services.  The ‘trim mean’ metric used to calculate averages excludes the highest and lowest values from the calculation.

Marlin cautions that averages can be misleading and that no one multiple or combination of multiples should be used as a predictor of the future value of any company.  Growth rates – which often help drive value – may include acquisitions while EBITDA profit margins – another value driver, may be skewed for a variety of reasons including currency fluctuations.

First quarter revenue and EBITDA multiples

Revenue multiples this quarter ranged from 1.8x trailing 2016 revenue for Forrester Research, a global industry research and advisory firm, to 9x trailing revenue for MSCI, an index, research and analytics provider.  The median value was 4.6x trailing 2016 revenues.

Sources: S&P Capital IQ, Marlin & Associates

EBITDA valuations in the first quarter ranged from 12,4x 2016 results for Euromoney Institutional Investor to 23.2x 2016 for Gartner, a leading technology industry research provider.

Marlin & Associates is an international investment bank and corporate advisory firm based in New York City, with offices in San Francisco, Washington, DC, and Toronto. The firm advises owners and managers of U.S. and international companies that provide software, data, and related services and has a particular expertise in advising owners and managers of firms that provide business intelligence, marketing intelligence, fintech and healthcare IT. For more information please visit

Moderate top line growth

Analysts expect average revenue growth in the industry to moderate slightly in 2017 – to an average of 5% from 6% in 2016.  But averages can be deceiving – with analysts expecting Informa to grow its revenue by 30% in 2017 (including the impact from acquisitions) while they forecast that revenue for IHS Markit will shrink by 3% as it consolidates after the merger.  Revenue growth for many of the firms in our industry is anticipated to be in the low single digits – as it was in 2016.

Sources: S&P Capital IQ, Marlin & Associates

Cautions on multiples

Since the majority of investment research businesses are either privately held or vertically integrated within broker-dealers, selecting publicly traded bellwethers for investment research is a challenge. All the firms selected offer research services, but in many cases research may be a minority component of overall business.

Note that the valuation multiple of a large publicly traded firm that is a leader in its niche may not be a valid comparable for assessing the value of smaller firms or those that are not market leaders. As a result, valuations for smaller privately held research firms may differ markedly from those implied by these multiples.

[1] Marlin & Associates Securities LLC, a wholly owned subsidiary of Marlin & Associates Holding LLC, is a broker-dealer registered with the Securities and Exchange Commission and is a FINRA/SIPC member firm ( For more see Nothing contained herein should be construed as a recommendation to purchase or sell any security. The information herein is not fully comprehensive, nor does it consider specific objectives, circumstances or needs of individual recipients.


About Author

Sandy Bragg is a principal at Integrity Research Associates. He has over thirty years experience as an investment research professional. Prior to joining Integrity in 2006, he was an Executive Managing Director at Standard & Poors, managing S&P’s equity research business and fund information properties. Sandy has an MBA from New York University and BA from Williams College. Email:

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