FirstService (TSX:FSV)(NASDAQ:FSV) is a popular name in the branded essential property services space. Indeed, the company’s five-year CAGR of 29.26% speaks to why investors have gravitated toward this pick.
Indeed, this stock has emerged as a fruitful play for growth investors in recent years. Recently, more analysts have developed a bullish stance on this TSX stock, making it a hot bet for many growth investors.
Here’s why analysts are bullish on FirstService, and why investors should take this into consideration today.
Impressive earnings make it a premium play
In its latest earnings report, this company recorded a whopping $711 million in revenue. This represented a year-over-year increase of 12%. As per the report, organic growth accounted for half of the surge. Also, its adjusted EBITDA came in at $60 million, representing an increase of 36% year over year.
Not bad indeed.
Likewise, FirstService’s adjusted earnings per share of $0.66 also manifested a jump of 78% compared to last year’s quarter. What impresses me the most is that FirstService managed to leave behind all past projections made by the analysts at RBC Dominion Securities and the Street in terms of its quarterly earnings.
In my opinion, the strong first quarter is a product of how FirstService’s home improvement brands managed to capitalize on increased restoration activities. Then again, FirstService Residential was also quite remarkable in combating pandemic-induced blows.
Collectively, these made the stock a lucrative play for investors.
But that’s not it.
Recently, the company also declared an increase of 11% in quarterly cash dividends. Needless to say, this stock has everything long-term investors want and continues to show the outperformance many were expecting with this stock for some time.
I think FirstService’s incredible performance in recent years is a strong indicator of this stock’s quality.
Yes, this is a stock that doesn’t provide much in the way of dips to buy on. However, for investors looking for capital appreciation, FirstService has proven itself to be a great long-term pick. I don’t see anything changing regarding the company’s growth backdrop from here.
Accordingly, most analysts (myself included) believe the company’s core business model will provide continued growth long term. A positive macroeconomic backdrop and a top-notch management team executing its strategy to perfection are key factors to keep in mind.
FirstService is a quality stock, with diverse revenue streams and a strong position in a red-hot market. Right now, this is the place long-term investors want to be.
For those considering a highly cyclical play in this pro-growth environment, FirstService is an excellent choice today.