Fact based stock research
FirstService (TSX:FSV)

CA33767E2024

How to read the free ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

FirstService stock research in summary

firstservice.com

ANALYSIS: With an Obermatt Combined Rank of 51 (better than 51% compared with investment alternatives), FirstService (Real Estate Services, Canada) shares have above-average financial characteristics compared with similar stocks. Shares of FirstService are low in value (priced high) with a consolidated Value Rank of 38 (worse than 62% of alternatives) and show below-average growth (Growth Rank of 32) but are safely financed (Safety Rank of 90), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 51, is a buy recommendation based on FirstService's financial characteristics. As the company FirstService's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 38) and low growth (Obermatt Growth Rank of 32), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 90) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	38
Growth Rank	32
Safety Rank	90
Combined Rank	51

Country	Canada
Industry	Real Estate Services
Index	NASDAQ, TSX Composite
Size class	X-Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: FirstService

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	10	45	38	38
GROWTH
GROWTH	70	11	77	32
SAFETY
SAFETY	87	67	85	90
SENTIMENT
SENTIMENT	n/a	77	73	^new
360° VIEW
360° VIEW	n/a	51	92	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better FirstService is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	10	45	38	38
GROWTH
GROWTH	70	11	77	32
SAFETY
SAFETY	87	67	85	90
COMBINED
COMBINED	58	34	93	51

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of FirstService the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 38 (worse than 62% compared with alternatives), FirstService shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for FirstService. Price-to-Sales (P/S) is 63, which means that the stock price compared with what market professionals expect for future sales is lower than 63% of comparable companies, indicating a good value concerning to FirstService's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 32, meaning that dividends are expected to be lower than for 68% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 90% of alternatives (only 10% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 60% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 38, is a hold recommendation based on FirstService's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in FirstService could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, FirstService looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	87	66	59	63
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	15	47	42	40
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	2	14	15	10
DIVIDEND YIELD
DIVIDEND YIELD	15	33	34	32
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	10	45	38	38

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of FirstService; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 32 (better than 32% compared with alternatives), FirstService shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for FirstService. Sales Growth has a rank of 58 which means that currently professionals expect the company to grow more than 58% of its competitors. Stock Returns are also above average with a rank of 62. But Capital Growth has only a rank of 33, which means that currently professionals expect the company to grow its invested capital less than 67% of its competitors. Profit Growth is also low, with a rank of only 34, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 32, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 62% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	80	27	86	58
PROFIT GROWTH
PROFIT GROWTH	20	26	53	34
CAPITAL GROWTH
CAPITAL GROWTH	n/a	38	50	33
STOCK RETURNS
STOCK RETURNS	47	31	73	62
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	70	11	77	32

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of FirstService.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives) for 2024, the company FirstService has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of FirstService is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for FirstService. Refinancing is at 67, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 67% of its competitors. Liquidity is also good at 93, meaning the company generates more profit to service its debt than 93% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 49, which means the company has an above-average debt-to-equity ratio. It has more debt than 51% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 90 (better than 90% compared with alternatives), FirstService has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and FirstService could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with FirstService and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	91	62	62	49
REFINANCING
REFINANCING	67	48	64	67
LIQUIDITY
LIQUIDITY	85	84	89	93
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	87	67	85	90

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of FirstService and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	30	89	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	79	6	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	31	42	^new
MARKET PULSE
MARKET PULSE	n/a	92	100	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	77	73	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for FirstService.
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