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Jones Lang LaSalle (JLL) Down 18.1% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Jones Lang LaSalle (JLL - Free Report) . Shares have lost about 18.1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Jones Lang LaSalle due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Jones Lang LaSalle Q4 Earnings & Revenues Top Estimates
JLL delivered fourth-quarter 2019 adjusted earnings of $6.35 per share, surpassing the Zacks Consensus Estimate of $5.73. The bottom-line figure also compares favorably with the year-ago adjusted earnings of $5.99 per share.
Revenues for the fourth quarter came in at around $5.4 billion, outpacing the Zacks Consensus Estimate of $5.3 billion by 1.3%. The reported figure improved 10.4%, year over year. Moreover, fee revenues were up 12% year over year to $2.37 billion.
Results highlight robust Real Estate Services revenue growth. The company witnessed solid performance of the Americas. Moreover, continued progress on HFF Inc. integration resulted in solid Capital Markets performance.
However, with respect to the real estate market outlook, it needs to be noted that the global environment remains cautious and investment volumes in 2020 are likely to moderate from the 2019 levels. Also, leasing in the current year is anticipated to be lower from the previous year.
For full-year 2019, JLL reported adjusted earnings of $14.09, denoting an increase of 15% from the prior-year tally of $12.25. This surge was backed by 10.2% year-over-year growth in revenues to $17.98 billion.
Behind the Headline Numbers
During the December-end quarter, JLL’s Real Estate Services revenues climbed 10% year over year to $5.2 billion. Result reflected solid Capital Markets performance, largely due to the Jul 1, 2019, acquisition of HFF Inc., along with a robust quarter in Asia Pacific.
In the Americas, revenues and fee revenues came in at $3.18 billion and $1.28 billion, respectively, indicating 15.7% and 22.1% year-over-year growth. Growth was strong and broad-based across all service lines. This was backed by Capital Markets. HFF reaped $203.2 million of incremental revenues, reflecting strong contributions from debt placement. Further, Project & Development Services fee revenues climbed year on year, mirroring large project wins in the United States.
Revenues and fee revenues of the EMEA segment came in at $1.07 billion and $559.8 million, up 0.7% but down 2.5%, respectively, from the year-ago period. Solid performance in Project & Development Services, particularly projects in MENA, as well as the valuations business was more than offset by declines in Capital Markets and Leasing, mainly due to decreases in the U.K., France and Germany.
For the Asia-Pacific segment, revenues and fee revenues came in at $969.8 million and $353.8 million, respectively, marking year-over-year jump of 3.8% and 0.6%. The segment experienced significant revenue and fee revenue growth in Capital Markets during the quarter, mainly driven by large deals in Singapore and Japan. However, the decline in leasing revenues reflects choppy market conditions in Hong Kong and China amid geopolitical tensions. Moreover, the drop in Property & Facility Management fee revenues was mainly due to client turnover and timing.
Revenues in the LaSalle segment increased 24.2% year over year to $186.7 million. Growth in annuity revenues for the quarter was mainly due to continued strong private equity capital raising during the year and fees from incremental assets under management from recent buyouts.
At the end of fourth-quarter 2019, assets under management were $67.6 billion, down marginally from the $67.8 billion recorded at the end of the last quarter.
Liquidity
JLL exited the fourth quarter with cash and cash equivalents of $451.9 million, down from $480.9 million as of Dec 31, 2018.
In addition, the company’s net debt totaled $860.9 million as of Dec 31, 2019, denoting decreases of $618.8 million from Sep 30, 2019. However, the figure marked an increase of $633.9 million from Dec 31, 2018, reflecting around $840 million of net cash outflow to acquire HFF, offset by strong cash generation in fourth-quarter 2019.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Jones Lang LaSalle has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Jones Lang LaSalle has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Jones Lang LaSalle (JLL) Down 18.1% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Jones Lang LaSalle (JLL - Free Report) . Shares have lost about 18.1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Jones Lang LaSalle due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Jones Lang LaSalle Q4 Earnings & Revenues Top Estimates
JLL delivered fourth-quarter 2019 adjusted earnings of $6.35 per share, surpassing the Zacks Consensus Estimate of $5.73. The bottom-line figure also compares favorably with the year-ago adjusted earnings of $5.99 per share.
Revenues for the fourth quarter came in at around $5.4 billion, outpacing the Zacks Consensus Estimate of $5.3 billion by 1.3%. The reported figure improved 10.4%, year over year. Moreover, fee revenues were up 12% year over year to $2.37 billion.
Results highlight robust Real Estate Services revenue growth. The company witnessed solid performance of the Americas. Moreover, continued progress on HFF Inc. integration resulted in solid Capital Markets performance.
However, with respect to the real estate market outlook, it needs to be noted that the global environment remains cautious and investment volumes in 2020 are likely to moderate from the 2019 levels. Also, leasing in the current year is anticipated to be lower from the previous year.
For full-year 2019, JLL reported adjusted earnings of $14.09, denoting an increase of 15% from the prior-year tally of $12.25. This surge was backed by 10.2% year-over-year growth in revenues to $17.98 billion.
Behind the Headline Numbers
During the December-end quarter, JLL’s Real Estate Services revenues climbed 10% year over year to $5.2 billion. Result reflected solid Capital Markets performance, largely due to the Jul 1, 2019, acquisition of HFF Inc., along with a robust quarter in Asia Pacific.
In the Americas, revenues and fee revenues came in at $3.18 billion and $1.28 billion, respectively, indicating 15.7% and 22.1% year-over-year growth. Growth was strong and broad-based across all service lines. This was backed by Capital Markets. HFF reaped $203.2 million of incremental revenues, reflecting strong contributions from debt placement. Further, Project & Development Services fee revenues climbed year on year, mirroring large project wins in the United States.
Revenues and fee revenues of the EMEA segment came in at $1.07 billion and $559.8 million, up 0.7% but down 2.5%, respectively, from the year-ago period. Solid performance in Project & Development Services, particularly projects in MENA, as well as the valuations business was more than offset by declines in Capital Markets and Leasing, mainly due to decreases in the U.K., France and Germany.
For the Asia-Pacific segment, revenues and fee revenues came in at $969.8 million and $353.8 million, respectively, marking year-over-year jump of 3.8% and 0.6%. The segment experienced significant revenue and fee revenue growth in Capital Markets during the quarter, mainly driven by large deals in Singapore and Japan. However, the decline in leasing revenues reflects choppy market conditions in Hong Kong and China amid geopolitical tensions. Moreover, the drop in Property & Facility Management fee revenues was mainly due to client turnover and timing.
Revenues in the LaSalle segment increased 24.2% year over year to $186.7 million. Growth in annuity revenues for the quarter was mainly due to continued strong private equity capital raising during the year and fees from incremental assets under management from recent buyouts.
At the end of fourth-quarter 2019, assets under management were $67.6 billion, down marginally from the $67.8 billion recorded at the end of the last quarter.
Liquidity
JLL exited the fourth quarter with cash and cash equivalents of $451.9 million, down from $480.9 million as of Dec 31, 2018.
In addition, the company’s net debt totaled $860.9 million as of Dec 31, 2019, denoting decreases of $618.8 million from Sep 30, 2019. However, the figure marked an increase of $633.9 million from Dec 31, 2018, reflecting around $840 million of net cash outflow to acquire HFF, offset by strong cash generation in fourth-quarter 2019.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Jones Lang LaSalle has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Jones Lang LaSalle has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.