Back to top

CBRE Group (CBRE) Q3 Earnings & Revenues Beat Estimates

Read MoreHide Full Article

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).

Liquidity

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.

Outlook

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.

Wall Street’s Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>



More from Zacks Analyst Blog

You May Like