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Colliers International Group Inc T.CIGI

Alternate Symbol(s):  CIGI

Colliers International Group Inc. is a diversified professional services company. It provides commercial real estate services, engineering consultancy and investment management with operations in 70 countries. Its segment includes Real Estate Services, Engineering and Investment Management. Its primary service lines are outsourcing, engineering, investment management, leasing and capital markets. Its services for landlords and investors include landlord representation, project management, capital market, valuation and advisory, real estate management, engineering and design services, and others. Its services for occupiers and tenants include occupier services, tenant representation, project management, technology services, and others. It offers services to various properties-including hospitality, industrial, land, multifamily, office, retail healthcare, and special purpose. It provides its services to a range of industries, such as education, self-storage, life science, and others.


TSX:CIGI - Post by User

Post by retiredcfon Oct 26, 2021 9:13am
152 Views
Post# 34048835

TD Upgrade

TD Upgrade

Colliers International Group Inc.

(CIGI-N, CIGI-T) US$144.70 | C$178.79

Q3/21 Preview: Robust Transaction Environment Continues Event

  • Colliers reports Q3/21 results at 7:00 a.m. ET on November 2; CC 11:00 a.m. (1-877-402-8911).

  • Colliers also announced its new "Enterprise '25 Growth Strategy" which looks to more than double EBITDA by 2025. See here.

    Impact: NEUTRAL

    We forecast Q3/21 revenue of $844.9mm, up 22% y/y, reflecting a 24% increase in brokerage revenues and ~20% revenue growth from each of the O&A segment and IM. We forecast EBITDA of $110.7mm (13.1% margin), ~10% above consensus of $100.8mm.

    We anticipate that capital markets/leasing activity will be a highlight again this quarter, with REAL Capital Analytics reporting U.S. commercial property sales hitting a new high in Q3/21, led by the Industrial and Apartment sectors (both strong sectors for CIGI). We anticipate that the robust Apartment/multi-family transaction activity should also benefit Collier's Mortgage (>20% EBITDA margins). On the office front, sales, and leasing data has been improving recently, with CBRE/ JLL/CWK reporting office tours at 80-90% of pre-COVID-19 levels (tours are a precursor to leasing/sales transaction). Interestingly, U.S. suburban office prices climbed 20.2% y/y in September (versus a 1.2% decline for CBD properties), which we anticipate will benefit CIGI given its over indexing to these markets versus the core gateway cities. Recall, in Q2/21, CIGI's office leasing remained ~29% below pre-pandemic levels with tenants still prioritizing flexibility. However, we believe that we may finally be reaching the inflection point for companies to begin committing to new longer-term office plans.

    Capital raising robust: We anticipate another strong AUM update from Harrison Street this quarter, with the close of its eighth opportunistic fund (its largest closed- end fund to date with $2bn raised) and also launching its first Canadian fund.

    2021 guidance: We had previously indicated that we viewed H2/21 guidance as conservative and based on recent industry trends, we anticipate that Colliers will increase its full-year 2021 outlook for the third time alongside Q3/21 results.

    TD Investment Conclusion

    We are maintaining our BUY recommendation and increasing our target to $170.00, reflecting the introduction of our 2023 estimates. We are attracted to Colliers' large and highly fragmented markets, demonstrated ability to add value through M&A, and improving mix of recurring revenues.


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