Will CBRE Group (CBG) Surprise This Earnings Season?
CBRE Group, Inc. CBG is slated to report third-quarter 2015 results after the market closes on Oct 27. Last quarter, this commercial real estate services and investment firm had delivered a 2.44% positive earnings surprise.
CBRE beat estimates in three out of the trailing four quarters, with a positive average earnings surprise of 10.03%. The Zacks Consensus Estimate for the third quarter is currently pegged at 45 cents.
Let’s see how things are shaping up for this announcement.
Factors to Consider
CBRE’s extensive real estate products and services offerings, improving leasing, property sales and outsourcing business, strategic buyouts and healthy balance sheet are expected to have driven its results in the third quarter.
In fact, a flourishing outsourcing business, backed by an expanding clientele, is expected to drive its top line, while market share gains are projected to push up leasing business results in the quarter.
However, uneasiness in certain global economies, stiff competition and unfavorable foreign currency movement remain as concerns. Some of the large global economies are experiencing a slump. This could have restricted the company’s growth momentum in the quarter.
Earnings Whispers
Our proven model does not conclusively show that CBRE will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. This is not the case here as you will see below.
Zacks ESP: Since both the Most Accurate estimate and the Zacks Consensus Estimate stand at 45 cents, the Earnings ESP, which represents the difference between the two, is 0.00% for the third quarter.
Zacks Rank #3: CBRE has a Zacks Rank #3, which when combined with a 0.00% ESP makes a surprise prediction uncertain this season.
Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some stocks in the real estate industry that with the right combination of elements to post an earnings beat this quarter:
Essex Property Trust Inc. ESS carries a Zacks Rank #2 and has an Earnings ESP of 0.82%. It is scheduled to report results on Oct 29.
Mid-America Apartment Communities Inc. MAA has an Earnings ESP of 0.75% and a Zacks Rank #2. The company will report third-quarter results on Oct 28.
CubeSmart CUBE has an Earnings ESP of 3.13% and a Zacks Rank #1. The company will report third-quarter results on Nov 5.
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CBRE GROUP INC (CBG): Free Stock Analysis Report
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