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On today's TSX Breakouts report, there are 31 stocks on the positive breakouts list (stocks with positive price momentum), and 29 securities are on the negative breakouts list (stocks with negative price momentum).

Discussed today is a stock that may resurface on the positive breakouts list in the weeks ahead as the share price is just 2 per cent away from closing at a record high. Over the past four quarters, after the company has reported its earnings, the share price has rallied between 3 per cent and 8 per cent that day.

If history repeats itself, the share price could rally to a record high in February, when the company is expected to report its fourth-quarter financial results. The security highlighted today is Colliers International Group Inc. (CIGI-T).

A brief outline is provided below that may serve as a springboard for further fundamental research.

The company

Toronto-based Colliers International Group is a global commercial real estate services company with operations in 68 countries. The company provides services such as real estate advisory services, property management, and property appraisals and taxation consulting.

In terms of revenue breakdown by segment, for the 12-month period that ended on Sept. 30, 36 per cent of the company's revenue was from outsourcing and advisory, 32 per cent was from sales brokerage, and 32 per cent was from lease brokerage.

Before the market opened on Oct. 31, the company reported better-than-expected third-quarter financial results. Revenue came in at $574-million (U.S.), well above the consensus estimate of $523-million. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $52.2-million, handily surpassing the Street's forecast of $48.6-million. Adjusted earnings per share was 61 cents, up 53 per cent from 40 cents reported last year and beating the consensus estimate of 56 cents.

Management's five-year plan is to double the size of the company by the year 2020 driven by completing strategic acquisitions.

Management's objectives are to realize revenues of $3.4-billion by 2020, achieve adjusted EBITDA of $390-million, and report adjusted earnings per share greater than $5. Revenue growth is anticipated to result from a combination of acquisition and organic growth, representing 10 per cent and 5 per cent, respectively (compound annual growth rate).

During the first nine months of 2017, the company added approximately $200-million in revenue from acquisitions. In the earnings release, Chairman and Chief Executive Officer Jay Hennick remarked, "Since the beginning of the quarter, we doubled the size of our project management business in Australia and added another high quality tenant advisory practice in Washington, D.C., bringing the total number of acquisitions so far this year to seven. We also established company-owned operations in Japan, the third largest economy in the world".

The acquisition in Japan is instrumental for the company's future growth. Chief Financial Officer John Friedrichsen highlighted the upside potential from Japan on the earnings call, stating, "We would certainly expect this business to be profitable in contributing EBITDA in 2018 and given that it's the third largest market in the world, there's huge opportunity for us to establish Colliers in that market and for it to become a significant part of our Asia Pacific and global business".

The company has a strong balance sheet to support its growth and fund future acquisitions. Net debt-to-adjusted EBITDA stood at 1.1 times at the end of the third quarter.

The company is expected to report its fourth-quarter financial results in February. The fourth quarter is historically the strongest with the highest reported earnings. The CFO John Friedrichsen highlighted on the third-quarter conference call that the company's "pipeline of pending transactions remains solid and reflects steady commercial real estate activity, which we expect to continue into Q4 (the fourth quarter)." The Street is expecting the company to report revenues of $660-million, EBITDA of $92.6-million and earnings per share of $1.24 during the fourth-quarter.

Insider ownership is significant representing over 20 per cent of shares outstanding, aligning insiders' interests with shareholders.

The company is dual-listed, trading on the Toronto Stock Exchange and Nasdaq under the same ticker, CIGI.

Dividend policy

The company pays its shareholders a semi-annual dividend of 5 cents (U.S.) per share, or 10 cents (U.S.) per share yearly. The annualized dividend yield is small at less than 0.2 per cent. Colliers has maintained its dividend at this level since mid-2016.

Analysts' recommendations

This mid-cap stock with a market capitalization of $3-billion is covered by nine analysts, of which eight analysts have buy recommendations and one analyst (from San Francisco-based JMP Securities) has a 'market perform' recommendation on the stock.

The company is covered by analysts from Canadian and U.S. firms. The nine firms providing research coverage on the company are as follows in alphabetical order: BMO Capital Markets, CIBC World Markets, EVA Dimensions, JMP Securities, Raymond James, RBC Capital Markets, Scotia Capital, Sidoti & Company LLC, and William Blair & Co.

Revised recommendations

Earlier this month, Marc Riddick, the analyst from Wall Street firm Sidoti & Company, took his target price up to $74 (U.S.) from $71.

After the company reported its third-quarter financial results on Oct. 31, numerous analysts revised their target prices – all higher. For instance, Frederic Bastien from Raymond James lifted his target price by $7 to $67 (U.S.). Stephanie Price, the analyst from CIBC Capital Markets, increased her target price to $66 (U.S.) from $58. Anthony Zicha from Scotia Capital bumped his target price up to $83 (Canadian) from $75.50. Stephen MacLeod from BMO Capital Markets lifted his target price to $65 (U.S.) from $63. Michael Smith from RBC Capital Market increased his target price by $4 to $66 (U.S.).

Financial Forecasts

All financial figures are denominated in U.S. dollars. The Street is forecasting EBITDA of $234.5-million, rising over 11 per cent to $262-million in 2018. The consensus earnings per share estimate is $2.92 in 2017, increasing 11 per cent to $3.24 in 2018.

Analysts have increased their earnings forecasts in recent months. For instance, four months ago, the consensus EBITDA estimates were $231-million in 2017 and $256-million in 2018, and the consensus EPS estimates were $2.80 for 2017 and $3.05 for 2018.

Valuation

According to Bloomberg, the stock is trading at an enterprise value-to-EBITDA multiple of over 10 times the 2018 consensus estimate.

The average one-year target price is $85.08 (Cdn), suggesting the share price may appreciate 9 per cent over the next 12 months.

Insider transaction activity

Looking back over the past year, no transactions in the public market have been reported by insiders.

Chart watch

After the company reported its third-quarter financial results at the end of October, the share price spiked higher into the mid-$70s (Canadian), where it has remained. The share price is 2 per cent away from closing at a record high.

In terms of key resistance and support levels, the share price faces initial resistance around $80, near its all-time closing high of $79.63 set on Nov. 24. There is strong downside support around $70, close to its 200-day moving average at $69.94.

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The Breakouts file is a technical analysis screen intended to identify companies that are technically breaking out. In addition, this report highlights a company's dividend policy, analysts' recommendations, financial forecasts, and provides a brief technical analysis for a security to provide readers with more information.

If a stock appears on the positive breakouts list, this indicates positive price momentum, and that a company may be worthwhile for investors to look at the fundamentals in order to determine if the recent price strength is warranted and will continue. If a security appears on the negative breakouts list, this indicates negative price momentum, and may be indicative of either deteriorating fundamentals or perhaps indicates a buying opportunity.

Securities screened are from the S&P/TSX composite index, the S&P/TSX Small Cap index, as well as Canadian small cap stocks outside of these indexes that have a minimum market capitalization of $200-million.

A technical analysis screen does not replace fundamental analysis, but can help identify companies worth having a closer look at.

Positive BreakoutsJan. 18 close
AFN-TAg Growth International Inc $60.09
AX.UN-TArtis Real Estate Investment Trust $14.29
ATA-TATS Automation Tooling Systems Inc $17.25
AVO-TAvigilon Corp $22.38
BMO-TBank of Montreal $103.75
PXX-TBlackPearl Resources Inc $1.23
BLX-TBoralex Inc $24.75
CTC.A-TCanadian Tire Corp Ltd $171.68
CWB-TCanadian Western Bank $40.29
CFP-TCanfor Corp $27.58
CMED-TCanniMed Therapeutics Inc. $32.60
CJT-TCargojet Inc $62.60
CLS-TCelestica Inc $14.05
CUF.UN-TCominar Real Estate Investment Trust $14.76
CSU-TConstellation Software Inc $798.10
FEC-TFrontera Energy Corp. $43.97
GEI-TGibson Energy Inc $19.02
GC-TGreat Canadian Gaming Corp $34.61
GCG.A-TGuardian Capital Group Ltd $26.93
KXS-TKinaxis Inc $78.79
MPC-TMadison Pacific Properties Inc. #NAME?
NA-TNational Bank of Canada $64.39
NFI-TNew Flyer Industries Inc $57.25
PDL-TNorth American Palladium Ltd $11.42
PLC-TPark Lawn Corp. $23.85
ROOT-TRoots Corp. $11.68
RY-TRoyal Bank of Canada $106.91
TOY-TSpin Master Corp. $54.11
STLC-TStelco Holdings Inc. $23.45
TGZ-TTeranga Gold Corp $3.53
X-TTMX Group Ltd $74.30
Negative Breakouts
AW.UN-TA&W Revenue Royalties Income Fund $32.70
AAV-TAdvantage Oil & Gas Ltd $4.31
ARX-TARC Resources Ltd $13.27
ACO.X-TAtco Ltd $43.60
BIR-TBirchcliff Energy Ltd $3.25
BPY.UN-TBrookfield Property Partners LP $26.38
CU-TCanadian Utilities Ltd $35.94
CGX-TCineplex Inc $29.90
CCA-TCogeco Communications Inc $77.12
CGO-TCogeco Inc $77.71
CJR.B-TCorus Entertainment Inc $8.16
CR-TCrew Energy Inc $2.52
CRE-TCritical Elements Corp. $1.39
EFN-TElement Fleet Management Corp. $8.89
IFC-TIntact Financial Corp $101.38
IPL-TInter Pipeline Ltd $25.29
LB-TLaurentian Bank of Canada $52.91
LNF-TLeon's Furniture Ltd. $18.00
LAC-TLithium Americas Corp $9.24
MMX-TMaverix Metals Inc. $1.62
PEY-TPeyto Exploration & Development Corp $12.03
PZA-TPizza Pizza Royalty Corp $14.51
POW-TPower Corp of Canada $31.90
SJR.B-TShaw Communications Inc $26.91
TKO-TTaseko Mines Ltd $2.38
TIH-TToromont Industries Ltd $54.51
TOT-TTotal Energy Services Inc $13.62
TOU-TTourmaline Oil Corp $20.46
TA-TTransAlta Corp $7.00

Source: Bloomberg