Value
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 5.1 |
| P/S | 9.8 |
| EV/EBITDA | 3.9 |
| Fwd P/E | 7.2 |
| PEG | 4.8 |
| Analyst target | 4.0 |
- ▸Forward P/E: 17.5x
- ▸PEG: 1.67
BBSI · Why this verdict
Why Barrett Business Services (BBSI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.3/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Cash conversion is excellent at 121% of net income, a standout positive in the quality assessment. Quality breakdown | Cash conversion stays strong near or above the current 121% level over the next 12 months. | →Stable |
| CounterThe overall score is still described as weak at 4.8 out of 10, and growth is flagged as weak, meaning strong cash conversion hasn't been enough to offset broader concerns. | ||
The setup is classified as trend continuation, with bullish MACD and RSI at 70, though momentum at 5.4 is flagged as a soft warning below the preferred 5.5 level. Gates warning | Momentum climbs above the preferred 5.5 level and the trend-continuation setup persists. | →Stable |
| CounterOn-balance volume shows distribution even as price sits above the 200-day moving average, and the moving-average slope is flat, suggesting the uptrend may be losing strength. | ||
The engine's asymmetry gate failed at -0.35, with the price target already described as reached (-5.3% versus the original target). Engine gate (failed) | The asymmetry ratio recovers to a positive reading as the risk/reward setup improves. | →Stable |
| CounterThe stock is still in a trend-continuation setup with bullish MACD, which could support further gains even with the original target already reached. | ||
Growth is flagged as weak in the bear case, consistent with a growth score of 3.7 out of 10. Bear case | The growth score improves meaningfully from its current 3.7 level over the next 12 months. | →Stable |
| CounterExcellent cash conversion (121% of net income) suggests the business can still generate strong returns for shareholders even without a growth re-acceleration. | ||
Implied volatility is elevated at 64%, even as the catalyst data shows a dividend metric of 84.0% that could support the shares. Risk breakdown | Implied volatility settles toward more typical levels over the next 12 months. | →Stable |
| CounterThe dividend-safety component sits only around the midpoint (5.2 out of 10), meaning the dividend support may not be as durable as the raw dividend metric suggests. | ||
Cash conversion is excellent at 121% of net income, a standout positive in the quality assessment.
→StableQuality breakdown
- Expectation
- Cash conversion stays strong near or above the current 121% level over the next 12 months.
CounterThe overall score is still described as weak at 4.8 out of 10, and growth is flagged as weak, meaning strong cash conversion hasn't been enough to offset broader concerns.
The setup is classified as trend continuation, with bullish MACD and RSI at 70, though momentum at 5.4 is flagged as a soft warning below the preferred 5.5 level.
→StableGates warning
- Expectation
- Momentum climbs above the preferred 5.5 level and the trend-continuation setup persists.
CounterOn-balance volume shows distribution even as price sits above the 200-day moving average, and the moving-average slope is flat, suggesting the uptrend may be losing strength.
The engine's asymmetry gate failed at -0.35, with the price target already described as reached (-5.3% versus the original target).
→StableEngine gate (failed)
- Expectation
- The asymmetry ratio recovers to a positive reading as the risk/reward setup improves.
CounterThe stock is still in a trend-continuation setup with bullish MACD, which could support further gains even with the original target already reached.
Growth is flagged as weak in the bear case, consistent with a growth score of 3.7 out of 10.
→StableBear case
- Expectation
- The growth score improves meaningfully from its current 3.7 level over the next 12 months.
CounterExcellent cash conversion (121% of net income) suggests the business can still generate strong returns for shareholders even without a growth re-acceleration.
Implied volatility is elevated at 64%, even as the catalyst data shows a dividend metric of 84.0% that could support the shares.
→StableRisk breakdown
- Expectation
- Implied volatility settles toward more typical levels over the next 12 months.
CounterThe dividend-safety component sits only around the midpoint (5.2 out of 10), meaning the dividend support may not be as durable as the raw dividend metric suggests.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Barrett Business Services shows excellent cash conversion and a trend-continuation momentum setup, but weak growth, a negative risk/reward setup with the price target already reached, and elevated implied volatility argue for reducing exposure.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 6.5 |
| ROA | 3.2 |
| Gross margin | 0.2 |
| Op margin | 0.0 |
| Net margin | 1.6 |
| Current ratio | 4.5 |
| FCF quality | 9.0 |
| Moat | 5.8 |
| Piotroski F | 5.6 |
- ▸Excellent cash conversion: 121% FCF/NI
Growth
3.7/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 3.7 |
Momentum
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.4 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 8.0 |
| Volume | 0.0 |
- ▸Overbought (RSI 73)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.9 |
| erm sentiment | 5.0 |
Insider
7.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
- ▸Negligible insider buying — $28,600 (0.003% of mkt cap)
- ▸Institutions accumulating
Peer rank
6.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.6 |
| quality rank | 7.1 |
| growth rank | 6.7 |
- ▸Conservative debt levels
Technical
2.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.8 |
| support resistance | 1.8 |
| 52w position | 5.2 |
Risk (lower is worse)
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.6 |
| days to cover | 8.3 |
| volatility | 3.4 |
| implied vol | 0.5 |
| beta | 7.3 |
| debt equity | 9.5 |
- ▸High IV: 77%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 4.2 |
| dividend safety | 5.5 |
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.5>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:29d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.3=NEGATIVE
Warning (2)
- DEATH_CROSS:momentum=6.5>=5.0 recovering
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.27
Upside
-4.0%
Downside
14.7%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 73
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $0.9B<$5B
Investment implication
The F-path SELL output reflects an overall score of 5.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Insider at 7.5) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.3=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.27 — supplementary context, not the trigger for this path.
The strongest dimensions are Insider at 7.5, Momentum at 6.5, and Peer rank at 6.3; the weakest are Technical at 2.9, Growth at 3.7, and Quality at 4.0. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of -0.27 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Excellent Cash Conversion
Trip ifFCF-to-net-income cash conversion falls below 60% from the current 121%.
- P2Momentum Trend Continuation Soft Warning
Trip ifMomentum score rises above 5.5, clearing the engine's preferred threshold from the current 5.4.
- P3Target Reached Negative Asymmetry
Trip ifThe asymmetry ratio rises above 0.0 from the current -0.35.
- P4Weak Growth
Trip ifThe growth score rises above 6.0 out of 10 from the current 3.7.
- P5Elevated Implied Volatility
Trip ifImplied volatility falls below 40% from the current 64% level.