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CBRE Group (CBRE) Q3 Earnings & Revenues Beat Estimates

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CBRE Group Inc. (CBRE - Free Report) reported third-quarter 2018 adjusted earnings per share of 79 cents, beating the Zacks Consensus Estimate of 74 cents. The figure also compares favorably with the prior-year tally of 65 cents.

Results indicate strong revenue growth, driven by leasing and occupier outsourcing.

On a GAAP basis, earnings per share came in at 85 cents, indicating a year-over-year jump of 47%.

The company posted revenues of around $5.3 billion, which beat the Zacks Consensus Estimate of $5.16 billion. It also compares favorably with the year-ago tally of $4.6 billion. Moreover, fee revenues were up 13% (14% in local currency) year over year to $2.6 billion, while organic fee revenues climbed 9% (10% local currency).

CBRE Group reported year-over-year leasing revenue growth of 17% (18% local currency). Global occupier outsourcing revenues increased 15% (16% local currency) from the prior-year quarter, with solid growth around the world and specifically in Americas, the Middle East & Africa (EMEA) and Asia Pacific (APAC).

In addition, capital markets businesses, which include property sales and commercial mortgage origination, reported combined revenue growth of 7% (8% local currency). Furthermore, global property sales revenues climbed 4% (5% local currency).

Quarter in Detail

CBRE Group’s largest business segment — The Americas — reported 12% rise (same in local currency) in revenues from the prior-year quarter to around $3.3 billion, registering growth in the United States. The APAC segment witnessed revenue improvement of 6% (9% local currency) from the prior-year quarter to nearly $530 million, with healthy growth in Greater China, Singapore and India.

Revenues from the EMEA segment rose 22% (23% in local currency) to $1.3 billion, supported by encouraging performance in Germany, Italy, Spain and the U.K.

In the Global Investment Management segment, revenues totaled approximately $93.1 million, up 1% year over year (same in local currency), while the Development Services segment posted revenues of nearly $25.8 million, up 60% year over year (same in local currency).


CBRE Group exited third-quarter 2018 with cash and cash equivalents of around $550.5 million, down from $751.8 million as of Dec 31, 2017.


CBRE Group expects adjusted earnings per share for 2018 to come at the higher end of the earlier provided range of $3.10-$3.20. The Zacks Consensus Estimate for the same is currently pegged at $3.17.

Our Viewpoint

CBRE Group’s better-than-expected third-quarter results are encouraging. Notably, diverse real-estate products and service offerings, and healthy leasing and outsourcing businesses drove the company’s Sep-end results.

Nevertheless, escalating competition from international, regional and local players remains a concern for the company.

CBRE Group, Inc. Price, Consensus and EPS Surprise

CBRE Group, Inc. Price, Consensus and EPS Surprise | CBRE Group, Inc. Quote


CBRE Group currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

We now look forward to the earnings releases of Host Hotels & Resorts, Inc.  (HST - Free Report) , Lamar Advertising Company (LAMR - Free Report) and Outfront Media Inc. (OUT - Free Report) . While Host Hotels is scheduled to report its quarterly numbers on Nov 2, Lamar and Outfront are slated to report their third-quarter earnings on Nov 8 and Nov 5, respectively.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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