FirstService Corp (NASDAQ: FSV)

Sector: Real Estate Industry: Real Estate Services CIK: 0001637810
Market Cap 7.01 Bn
P/B 10.05
P/E 56.92
P/S 1.78
ROIC (Qtr) 8.15
Div Yield % 0.70
Rev 1y % (Qtr) 3.69
Total Debt (Qtr) 1.51 Bn
Debt/Equity (Qtr) 1.13

About

Price action

Investment thesis

Bull case

  • Healthy cash reserves of 245.51M provide 3.42x coverage of short-term debt 71.82M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 417.17M provides strong 15.77x coverage of stock compensation 26.46M, indicating sustainable incentive practices.
  • Robust free cash flow of 288.65M exceeds capital expenditure of 128.52M by 2.25x, indicating strong organic growth funding capability.
  • Tangible assets of 2.19B provide exceptional 9.04x coverage of deferred revenue 242.61M, showing strong service capability backing.
  • Robust tangible asset base of 2.19B provides 3.16x coverage of working capital 693.42M, indicating strong operational backing.

Bear case

  • Operating cash flow of 417.17M barely covers its investment activities of (289.90M), with a coverage ratio of -1.44, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 417.17M provides thin coverage of dividend payments of (47.59M) with a -8.77 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 245.51M provide limited coverage of acquisition spending of (149.97M), which is -1.64x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • High receivables of 963.84M relative to inventory of 291.40M (3.31 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Operating earnings of 292.83M show weak coverage of depreciation charges of 184.27M, with a 1.59 ratio indicating high capital intensity and potential reinvestment needs.

Peer comparison

Companies in the Real Estate Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 CBRE Cbre Group, Inc. 51.14 Bn 41.65 1.30 9.48 Bn
2 CSGP Costar Group, Inc. 26.47 Bn 1,304.00 8.66 1.18 Bn
3 BEKE KE Holdings Inc. 21.08 Bn 43.29 1.45 2.96 Bn
4 JLL Jones Lang Lasalle Inc 16.90 Bn 26.75 0.67 3.48 Bn
5 FSV FirstService Corp 7.01 Bn 56.92 1.78 1.51 Bn
6 COMP Compass, Inc. 6.69 Bn -118.64 1.01 0.48 Bn
7 CIGI Colliers International Group Inc. 5.39 Bn 69.70 2.00 2.50 Bn
8 OPEN Opendoor Technologies Inc. 4.15 Bn -13.09 0.88 1.79 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.78 1.34
EV to Cash from Ops. EV/CFO 74.93 2.97
EV to Debt EV to Debt 5.16 6.15
EV to EBIT EV/EBIT 38.04 5.23
EV to EBITDA EV/EBITDA 22.47 18.71
EV to Free Cash Flow [EV/FCF] EV/FCF 361.40 -9.39
EV to Market Cap EV to Market Cap 1.11 4.27
EV to Revenue EV/Rev 1.98 3.62
Price to Book Value [P/B] P/B 10.05 2.10
Price to Earnings [P/E] P/E 56.92 45.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 2.91 0.38
Dividend Payout Ratio % Div Payout % (Qtr) 44.60 -6.05
Dividend per Basic Share Div per Share (Qtr) 1.35 0.22
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 21.31 0.42
Interest Coverage Int. cover (Qtr) 3.77 -2.22
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -30.35 -12,525.88
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 4.01 23.84
Dividend Growth (1y) % Div 1y % (Qtr) 35.00 1.27
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 21.50 4.69
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 17.61 26.73
EBIT Growth (1y) % EBIT 1y % (Qtr) 19.18 12.80
EBT Growth (1y) % EBT 1y % (Qtr) 25.64 21.27
EPS Growth (1y) % EPS 1y % (Qtr) 26.25 22.42
FCF Growth (1y) % FCF 1y % (Qtr) 36.93 54.29
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 13.91 39.11
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.25 1.45
Cash Payout Ratio Cash Payout (Qtr) 0.09 -0.01
Cash Ratio Cash Ratio (Qtr) 0.27 1.45
Current Ratio Curr Ratio (Qtr) 1.76 2.16
Debt to Equity Ratio Debt/Equity (Qtr) 1.13 -0.06
Interest Cover Ratio Int Coverage (Qtr) 3.77 -2.22
Times Interest Earned Times Interest Earned (Qtr) 3.77 -2.22
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 8.70 -121.98
EBIT Margin % EBIT Margin % (Qtr) 5.34 -136.76
EBT Margin % EBT Margin % (Qtr) 3.93 -144.54
Gross Margin % Gross Margin % (Qtr) 33.40 32.87
Net Profit Margin % Net Margin % (Qtr) 2.50 -139.89