CBRE Group Inc. Earnings Cheat Sheet: Revenue Strengthens Again by Double-Digits

S&P 500 (NYSE:SPY) component CBRE Group Inc. (NYSE:CBG) reported higher profit for the third quarter as revenue showed growth. CBRE Group is a commercial real estate services firm which serves the occupiers, owners, lenders, and investors of multi-family and other commercial real estate.

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CBRE Group Earnings Cheat Sheet for the Third Quarter

Results: Net income for the property management company rose to $63.8 million (20 cents per share) vs. $57 million (18 cents per share) in the same quarter a year earlier. This marks a rise of 11.9% from the year earlier quarter.

Revenue: Rose 21.2% to $1.53 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: CBG reported adjusted net income of 24 cents per share. By that measure, the company fell in line with the mean estimate of 24 cents per share. It beat the average revenue estimate of $1.47 billion.

Quoting Management: “We are very pleased to report double-digit growth in revenue, earnings and adjusted EBITDA during a time of increased financial market volatility and economic uncertainty,” said Brett White, chief executive officer of CBRE. “Global revenue rose significantly in nearly all of our major service lines and geographies, reflecting the durability of the commercial real estate market recovery, coupled with our ability to improve market share in an uneven macro environment.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 21.8%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 27.4% from the year earlier quarter.

Gross margin shrank 0.2 percentage point to 41.7%. The contraction appeared to be driven by increased costs, which rose 21.7% from the year earlier quarter while revenue rose 21.2%.

The company fell in line with estimates last quarter after missing forecasts in the previous quarter with net income of 21 cents versus a mean estimate of net income of 24 cents per share.

Looking Forward: Over the past ninety days, the average estimate for the fourth quarter has fallen from 48 cents per share to 42 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is $1 per share, down from $1.10 ninety days ago.

Competitors to Watch: Jones Lang LaSalle Inc. (NYSE:JLL), Grubb & Ellis Company (NYSE:GBE), Kennedy-Wilson Hldgs., Inc. (NYSE:KW), HFF, Inc. (NYSE:HF), General Electric Company (NYSE:GE), E-House (NASDAQ:CHINA) Hldgs. Ltd. (NYSE:EJ), American Spectrum Realty, Inc. (AMEX:AQQ), and Walker & Dunlop, Inc. (NYSE:WD).

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(Source: Xignite Financials)