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Why Is Jones Lang LaSalle (JLL) Up 6.6% Since Last Earnings Report?
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A month has gone by since the last earnings report for Jones Lang LaSalle (JLL - Free Report) . Shares have added about 6.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Jones Lang LaSalle due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Jones Lang LaSalle Q3 Earnings and Revenues Beat Estimates
JLL delivered third-quarter adjusted earnings of $3.52 per share, surpassing the Zacks Consensus Estimate of $2.73. The bottom-line figure also compares favorably with the year-ago adjusted earnings of $3.02 per share.
Revenues for the third quarter came in at around $4.5 billion, outpacing the Zacks Consensus Estimate of $4.35 billion by 3.3%. The reported figure improved 13.2%, year over year. Moreover, fee revenues were up 14.1% year over year to $1.8 billion.
Results highlight robust Real Estate Services revenue growth. The company witnessed solid Americas’ leasing and Capital Markets performance, while Corporate Solutions growth boosted annuity base. The company gained from the HFF Inc. acquisition and progressed well with its integration in the quarter.
Behind the Headline Numbers
During the September-end quarter, JLL’s Real Estate Services revenues climbed 15.5% year over year to $4.4 billion.
In the Americas, revenues and fee revenues came in at $2.7 billion and $1 billion, respectively, indicating 22.1% and 34.8% year-over-year growth. Growth was strong and broad-based across all service lines. This was backed by Capital Markets, mainly reflecting revenue gain from the HFF acquisition. Also, the company witnessed robust leasing performance across a number of U.S. markets and all major asset classes. Further, new project wins and expanded assignments with Corporate Solutions clients drove revenues from Project & Development Services. Segment fee revenue growth, excluding contributions from HFF, was strong at 12%.
Revenues and fee revenues of the EMEA segment came in at $862.6 million and $401.0 million, up 7.1% and 1.1%, respectively, from the year-ago period. Results suggest solid annuity growth in Project & Development Services and Property & Facility Management. However, softness in U.K. Leasing and decline in regional capital markets volumes partly offset these positives.
For the Asia-Pacific segment, revenues and fee revenues came in at $833.8 million and $264.9 million, respectively, marking year-over-year uptick of 5.5% and 5%. Results reflect gains in Capital Markets, steered by large deals in Greater China and growth in Japan. Also, Project & Development Services reported growth, mainly aided by Corporate Solutions project wins across a number of geographical markets. Nevertheless, decline in leasing segment results partly marred the positives.
Revenues from the LaSalle segment plunged 35.3% year over year to $111.6 million. Growth in annuity revenues was more than offset by lower incentive fees.
At the end of third-quarter 2019, assets under management were $67.8 billion, down nearly 1% from the $68.4 billion recorded at the end of the last quarter.
Liquidity
JLL exited the third quarter with cash and cash equivalents of $402.2 million, down from $480.9 million as of Dec 31, 2018.
In addition, the company’s net debt totaled $1.5 billion as of Sep 30, 2019, denoting increases of $589.4 million and $784.0 million from Jun 30, 2019 and Sep 30, 2018, respectively. This hike reflects around $840 million of net cash outflow for the acquisition of HFF.
Dividend Update
JLL announced a common stock dividend of 43 cents per share. This dividend will be paid on Dec 13, to shareholders of record on Nov 15, 2019.
Share Repurchase Program
A new share-repurchase program authorizing buyback of up to $200 million of JLL common stock in the open market and privately-negotiated transactions was approved by the company’s board on Oct 31. The latest program cancels and replaces the existing share-repurchase program. Notably, as of Nov 5, 2019, the company has repurchased any shares in 2019 under both the new or prior programs.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Jones Lang LaSalle has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Jones Lang LaSalle has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Why Is Jones Lang LaSalle (JLL) Up 6.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Jones Lang LaSalle (JLL - Free Report) . Shares have added about 6.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Jones Lang LaSalle due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Jones Lang LaSalle Q3 Earnings and Revenues Beat Estimates
JLL delivered third-quarter adjusted earnings of $3.52 per share, surpassing the Zacks Consensus Estimate of $2.73. The bottom-line figure also compares favorably with the year-ago adjusted earnings of $3.02 per share.
Revenues for the third quarter came in at around $4.5 billion, outpacing the Zacks Consensus Estimate of $4.35 billion by 3.3%. The reported figure improved 13.2%, year over year. Moreover, fee revenues were up 14.1% year over year to $1.8 billion.
Results highlight robust Real Estate Services revenue growth. The company witnessed solid Americas’ leasing and Capital Markets performance, while Corporate Solutions growth boosted annuity base. The company gained from the HFF Inc. acquisition and progressed well with its integration in the quarter.
Behind the Headline Numbers
During the September-end quarter, JLL’s Real Estate Services revenues climbed 15.5% year over year to $4.4 billion.
In the Americas, revenues and fee revenues came in at $2.7 billion and $1 billion, respectively, indicating 22.1% and 34.8% year-over-year growth. Growth was strong and broad-based across all service lines. This was backed by Capital Markets, mainly reflecting revenue gain from the HFF acquisition. Also, the company witnessed robust leasing performance across a number of U.S. markets and all major asset classes. Further, new project wins and expanded assignments with Corporate Solutions clients drove revenues from Project & Development Services. Segment fee revenue growth, excluding contributions from HFF, was strong at 12%.
Revenues and fee revenues of the EMEA segment came in at $862.6 million and $401.0 million, up 7.1% and 1.1%, respectively, from the year-ago period. Results suggest solid annuity growth in Project & Development Services and Property & Facility Management. However, softness in U.K. Leasing and decline in regional capital markets volumes partly offset these positives.
For the Asia-Pacific segment, revenues and fee revenues came in at $833.8 million and $264.9 million, respectively, marking year-over-year uptick of 5.5% and 5%. Results reflect gains in Capital Markets, steered by large deals in Greater China and growth in Japan. Also, Project & Development Services reported growth, mainly aided by Corporate Solutions project wins across a number of geographical markets. Nevertheless, decline in leasing segment results partly marred the positives.
Revenues from the LaSalle segment plunged 35.3% year over year to $111.6 million. Growth in annuity revenues was more than offset by lower incentive fees.
At the end of third-quarter 2019, assets under management were $67.8 billion, down nearly 1% from the $68.4 billion recorded at the end of the last quarter.
Liquidity
JLL exited the third quarter with cash and cash equivalents of $402.2 million, down from $480.9 million as of Dec 31, 2018.
In addition, the company’s net debt totaled $1.5 billion as of Sep 30, 2019, denoting increases of $589.4 million and $784.0 million from Jun 30, 2019 and Sep 30, 2018, respectively. This hike reflects around $840 million of net cash outflow for the acquisition of HFF.
Dividend Update
JLL announced a common stock dividend of 43 cents per share. This dividend will be paid on Dec 13, to shareholders of record on Nov 15, 2019.
Share Repurchase Program
A new share-repurchase program authorizing buyback of up to $200 million of JLL common stock in the open market and privately-negotiated transactions was approved by the company’s board on Oct 31. The latest program cancels and replaces the existing share-repurchase program. Notably, as of Nov 5, 2019, the company has repurchased any shares in 2019 under both the new or prior programs.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Jones Lang LaSalle has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Jones Lang LaSalle has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.