CB Richard Ellis group will be announcing their fourth quarter earnings this coming Monday. The company has been performing well according to analysts, earnings expected; $0.44 per share with $1.01 per sharefor the fiscal year.
Currently, their stock is trading at $19.61, with a price-earnings multiple of 19.41. Since the last quarter’s earnings call CBRE Group have had double-digit growth. In the past four quarters their fourth quarter was their strongest. Investors should expect a slightly better fourth quarter this year. The third quarter saw 21% revenue growth, capitalizing on depressed levels in commercial real estate.
At the current stock price of $19.61, an investment may be a hold at best. According to Morningstarthe fair value for CBRE Group is $21. They recommend buying at a price level near $10 a share.
At any rate, speculators will be more concerned with earnings; price fluctuations become very volatile during earnings announcements. Morningstar projects revenue growth of 12% for 2012, which is quite a bit slower from their current 20%+ revenue growth. However, they also see operating margins expanding. If margins do widen to double-digits Morningstar believes the stock price could trade at or near $37 a share. The overall stock rating is three out of five stars.
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