The company expects top-line growth in the second half to be similar to, or modestly better than, year-to-date levels.
It sees continued macroeconomic headwinds tempering organic growth.
Quarterly results
Canada property services firm’s Q2 revenue rose 2% year over year but missed analyst expectations.
Adjusted EPS for Q2 rose 2% and beat analyst expectations.
The company said macroeconomic headwinds tempered organic growth in Q2.
Result drivers and valuation
Macroeconomic headwinds — The company said continued macroeconomic headwinds tempered organic growth in Q2.
Segment mix — Organic growth at FirstService Residential was driven by new contract wins and increased labor-related services, while FirstService Brands saw a decline in organic revenue due to reduced activity at Roofing Corp. of America.
Divestiture impact — The divestiture of non-core residential aquatic operations reduced reported growth at FirstService Residential.
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 8 "strong buy" or "buy," no "hold" and no "sell" or "strong sell." The average consensus recommendation for the real estate services peer group is "buy." The stock recently traded at 22 times the next 12-month earnings versus a P/E of 22 three months ago.
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