Investors interested in stocks from the Real Estate - Operations sector have probably already heard of TPG RE Finance Trust (TRTX) and FirstService (FSV) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is ...

Core Insights - The real estate sector is experiencing a trend of oversold stocks, presenting potential buying opportunities for undervalued companies [1] - The Relative Strength Index (RSI) is a key indicator used to identify oversold conditions, with a value below 30 indicating potential buying opportunities [1] Company Summaries - **Fermi Inc (NASDAQ:FRMI)**: Priced its IPO at $21 per share, but the stock has fallen approximately 30% in the past five days, with a 52-week low of $18.70. Current RSI is 27.4, and shares closed at $19.84, down 0.3% [5] - **Apartment Investment and Management Co (NYSE:AIV)**: Recently closed the sale of four properties for $490 million and declared a special cash dividend of $2.23 per share. The stock has decreased around 26% over the past month, with a 52-week low of $5.49. Current RSI is 24, and shares closed at $5.69, up 0.4% [5] - **FirstService Corp (NASDAQ:FSV)**: Reported mixed quarterly results, with CEO noting resilient growth despite market challenges. The stock has fallen about 13% in the past month, with a 52-week low of $153.13. Current RSI is 11.3, and shares closed at $166.73, down 9.8% [5]

Financial Data and Key Metrics Changes - Total revenues increased by 4% year-over-year to $1.45 billion, driven by tuck-under acquisitions, while organic growth was flat overall [3][12] - EBITDA rose by 3% to $165 million, with a consolidated margin of 11.4%, slightly down from 11.5% in the previous year [3][12] - Earnings per share (EPS) increased by 8% to $1.76 [3][12] - Year-to-date revenues reached $4.1 billion, up 7% from $3.85 billion in the prior year, with adjusted EBITDA at $425 million, a 13% increase [12][13] Business Line Data and Key Metrics Changes - **FirstService Residential**: Revenues grew by 8% with organic growth at 5%, supported by solid net contract wins [4][13] - **FirstService Brands**: Revenues were up 1%, but organic declines of 4% were noted, particularly in restoration brands [4][14] - **Roofing Segment**: Revenues increased mid-single digits due to acquisitions, but organic revenues declined by 8% [7][9] - **Century Fire Protection**: Revenues rose over 10%, driven by strong repair, service, and inspection revenues [9][10] Market Data and Key Metrics Changes - Industry-wide claim activity and weather-related damage were modest across North America, leading to a decline in restoration revenues compared to the previous year [5][6] - The company anticipates a 20% decline in restoration revenues for Q4 compared to the prior year due to minimal storm-related revenues [6][7] - The roofing segment is experiencing delays in large commercial projects and a general reduction in new construction, impacting organic growth [8][9] Company Strategy and Development Direction - The company remains focused on long-term growth opportunities in restoration and roofing despite current macroeconomic challenges [30][40] - Recent acquisitions in roofing are aimed at expanding presence in key markets, with a commitment to investing in the roofing segment [9][16] - The company is actively pursuing tuck-under acquisitions, although competition remains high, particularly in fire protection and residential property management [35][36] Management's Comments on Operating Environment and Future Outlook - Management noted that macroeconomic stability is needed for improvement in commercial construction and to release deferred work [30][40] - The outlook for Q4 indicates revenues roughly in line with the prior year, with expectations of mid-single-digit growth in consolidated annual revenues for the full year [17][30] - Management expressed confidence in the long-term demand prospects for roofing and restoration, citing aging building stock and increased weather events as key drivers [40][41] Other Important Information - The company generated over $125 million in cash flow from operations during Q3, totaling $330 million year-to-date, a significant increase of approximately 65% year-over-year [15][16] - The balance sheet showed net debt of $985 million, with a leverage ratio of 1.7 times net debt to trailing 12 months EBITDA [16] Q&A Session Summary Question: Divergence in performance between Century Fire Protection and roofing business - Management explained that Century Fire Protection's service, repair, and inspection business is more recurring and has been resilient, benefiting from growth in data centers [19][20] Question: Margins in the Brands division - Management highlighted strong profitability in home improvement and Century Fire, attributing it to operational efficiencies and client relationships [21][22] Question: Market share gains in restoration - Management noted that efforts in positioning with national accounts and increased activity across the branch network contributed to market share gains [25][26] Question: Outlook for FirstService Residential margins - Management indicated that while margin improvements have been significant, some tapering is expected in Q4 due to seasonal factors [27][28] Question: Roofing project delays and future growth - Management acknowledged the uncertainty in the market but expressed confidence in the long-term demand prospects for roofing [30][40] Question: Competition for tuck-under deals - Management confirmed that the M&A environment remains competitive, particularly in roofing, but they continue to seek opportunities [35][36] Question: Backlog status in restoration - Management reported that the backlog is stable but slightly off from last year, with some impact from previous storm-related work [48] Question: Performance in Florida - Management stated that Florida's performance is in line with expectations, with some budgetary pressures alleviated due to stabilization in the insurance market [50]

Financial Data and Key Metrics Changes - Total revenues increased by 4% year-over-year to $1.45 billion, driven by tuck-under acquisitions, while organic growth was flat overall [3][12] - EBITDA rose by 3% to $165 million, with a consolidated margin of 11.4%, slightly down from 11.5% in the previous year [3][12] - Earnings per share (EPS) increased by 8% to $1.76 [3][12] - Year-to-date revenues reached $4.1 billion, up 7% from $3.85 billion in the prior year, with adjusted EBITDA at $425 million, a 13% increase [12][13] Business Line Data and Key Metrics Changes - **FirstService Residential**: Revenues increased by 8% to $605 million, with organic growth at 5% [4][13] - **FirstService Brands**: Revenues were up 1% to $842 million, but organic declines of 4% were noted [4][14] - **Restoration Brands**: Revenues were down 7% year-over-year, despite sequential growth relative to Q2 [4][5] - **Roofing Segment**: Revenues increased mid-single digits due to acquisitions, but organic revenues declined by 8% [7][8] - **Century Fire Protection**: Revenues grew over 10% year-over-year, supported by strong repair, service, and inspection revenues [9][12] Market Data and Key Metrics Changes - Industry-wide claim activity and weather-related damage were modest across North America, leading to lower revenues from named storms compared to the previous year [5][6] - The company anticipates a 20% decline in revenues for Q4 compared to the prior year due to minimal storm-related revenues [6][7] - The roofing segment is experiencing delays in large commercial projects and a general reduction in new construction [8][39] Company Strategy and Development Direction - The company remains focused on long-term growth opportunities in restoration and roofing, despite current macroeconomic challenges [30][31] - Recent acquisitions in roofing are aimed at expanding presence in key markets [8][9] - The company is committed to maintaining a strong balance sheet and generating consistent free cash flows [16] Management's Comments on Operating Environment and Future Outlook - Management noted that macroeconomic stability is needed for improvement in commercial construction and to release deferred work [30][39] - The outlook for Q4 indicates revenues roughly in line with the prior year, culminating in mid-single-digit growth for the full year [17] - Management expressed confidence in the long-term demand prospects for roofing and restoration, driven by aging infrastructure and increased weather events [39] Other Important Information - Cash flow from operations for Q3 was over $125 million, totaling $330 million year-to-date, a significant increase of approximately 65% year-over-year [15] - The company has a net debt of $985 million, with a leverage ratio of 1.7x net debt to trailing 12 months EBITDA [16] Q&A Session Summary Question: Divergence in performance between Century Fire and roofing business - Management explained that Century Fire's service, repair, and inspection business is more resilient due to its recurring nature and focus on data centers, while roofing is facing delays [19][20] Question: Margins in the Brands division - Management highlighted strong profitability in home improvement and Century Fire, despite challenges in restoration and roofing [21][22] Question: Market share gains in restoration - Management attributed market share gains to solidifying relationships with national accounts and increased activity across the branch network [25][26] Question: Margins and seasonal weakness in FirstService Residential - Management indicated that while margins may taper, ongoing initiatives are in place to maintain efficiency [27][28] Question: Impact of macroeconomic factors on roofing - Management noted that macroeconomic stability is essential for the release of deferred work and that the long-term demand prospects remain strong [30][39] Question: Competition for tuck-under deals - Management acknowledged a competitive environment for acquisitions, particularly in fire protection and residential property management [34][35] Question: Backlog status in restoration - Management reported that the backlog is stable but slightly down from last year due to previous strong performance in Canada [47] Question: Florida's performance in FirstService Residential - Management stated that Florida's performance is in line with expectations, with some budgetary pressures alleviated [49] Question: Pricing power and cost pressures - Management expressed confidence in maintaining pricing power across various segments, with a focus on efficiency [52][56] Question: Acquisition strategy in roofing - Management confirmed ongoing interest in acquisitions, focusing on cultural fit and strategic alignment [46]

Financial Data and Key Metrics Changes - Total revenues increased by 4% year-over-year to $1,450,000,000, driven by tuck-under acquisitions, while organic growth was flat overall [5][16] - EBITDA rose by 3% to $165,000,000, with a consolidated margin of 11.4%, slightly down from 11.5% in the previous year [5][16] - Earnings per share increased by 8% to $1.76 [5][16] - Year-to-date revenues reached $4,100,000,000, up 7% from $3,850,000,000 in the prior year, with adjusted EBITDA at $425,000,000, reflecting a 13% increase [17] Business Line Data and Key Metrics Changes - **FirstService Residential**: Revenues increased by 8% to $675,000,000, with organic growth at 5% [5][18] - **FirstService Brands**: Revenues were up 1% to $842,000,000, but organic growth declined by 4% [6][19] - **Restoration Brands**: Revenues were down 7% year-over-year, impacted by lower industry-wide claim activity and weather-related damage [6][7] - **Roofing Segment**: Revenues increased by mid-single digits due to acquisitions, but organic revenues declined by 8% [9][10] - **Century Fire**: Revenues grew over 10% year-over-year, supported by strong repair, service, and inspection revenues [14] Market Data and Key Metrics Changes - Industry-wide claim activity and weather-related damage were modest across North America, leading to lower revenues from named storms compared to the previous year [7][8] - The company anticipates a 20% decline in revenues for Q4 compared to the prior year due to minimal storm-related revenues [8][9] Company Strategy and Development Direction - The company remains focused on long-term growth opportunities in restoration and roofing despite current macroeconomic challenges [40] - Recent acquisitions in roofing are aimed at expanding presence in key markets [12] - The company is committed to maintaining a strong balance sheet and generating consistent free cash flows [21] Management's Comments on Operating Environment and Future Outlook - Management noted that the current environment is impacting new commercial construction and causing delays in reroof and maintenance decisions [12][40] - The outlook for Q4 indicates modest growth in roofing revenues due to acquisitions, but continued organic weakness is expected [13][22] - Management expressed confidence in the long-term demand drivers for roofing and restoration services [40] Other Important Information - Cash flow from operations for Q3 was over $125,000,000, with year-to-date cash flow at $330,000,000, a 65% increase year-over-year [20] - The company has a net debt of $985,000,000, resulting in a leverage ratio of 1.7 times net debt to trailing twelve months EBITDA [21] Q&A Session Summary Question: Divergence in performance between Century Fire and roofing business - Management explained that Century Fire's business is more resilient due to its focus on service repair and inspection, which is less affected by new construction delays [26][27] Question: Margins in the brands division - Management highlighted that home improvement initiatives have led to strong profitability despite weak restoration and roofing results [29][30] Question: Market share gains in restoration - Management noted that efforts to solidify relationships with national accounts have resulted in increased market share despite a weak backdrop [33][34] Question: Outlook for roofing and restoration - Management indicated that macroeconomic stability is needed for improvement in commercial construction and roofing activity [39][40] Question: Competition for tuck-under deals - Management acknowledged that competition remains high for acquisitions, particularly in fire protection and residential property management [43][44] Question: Pricing and cost relationship - Management stated that pricing power is currently stable, but there may be cost pressures in roofing due to labor availability [66][70] Question: Backlog status in restoration - Management reported that the backlog is stable but slightly down from last year due to strong prior year performance [60] Question: Florida's performance in FirstService Residential - Management confirmed that Florida's performance is in line with expectations, with some budgetary pressures alleviated [62]

Financial Data and Key Metrics Changes - Total revenues increased by 4% year-over-year to $1.45 billion, driven by tuck-under acquisitions, while organic growth was flat overall [3][10] - EBITDA rose by 3% to $165 million, with a consolidated margin of 11.4%, slightly down from 11.5% in the previous year [3][10] - Earnings per share increased by 8% to $1.76 [3][10] - Year-to-date revenues reached $4.1 billion, up 7% from $3.85 billion in the prior year [10][11] - Adjusted EBITDA for the year-to-date was $425 million, reflecting a 13% increase year-over-year [11] Business Line Data and Key Metrics Changes - **FirstService Residential**: Revenues increased by 8% to $605 million, with organic growth at 5% [4][11] - **FirstService Brands**: Revenues were up 1% to $842 million, but EBITDA decreased from $105.8 million to $102.1 million, resulting in a margin compression to 12.1% [12][13] - **Restoration Brands**: Revenues were down 7% year-over-year, impacted by lower industry-wide claim activity and weather-related damage [5][6] - **Roofing Segment**: Revenues increased mid-single digits due to acquisitions, but organic revenues declined by 8% [6][7] - **Century Fire Protection**: Revenues grew over 10% year-over-year, supported by strong repair, service, and inspection revenues [8] Market Data and Key Metrics Changes - Industry-wide claim activity and weather-related damage were modest across North America, leading to a significant decline in storm-related revenues compared to the previous year [5][6] - The company anticipates a 20% decline in revenues for Q4 compared to the prior year due to the absence of significant weather events [5][6] - The roofing market is experiencing delays in new construction and reroofing projects, impacting overall performance [7][36] Company Strategy and Development Direction - The company remains focused on long-term growth opportunities in restoration and roofing despite current macroeconomic challenges [27][39] - Recent acquisitions in the roofing segment aim to enhance market presence and capabilities in key regions [7][8] - The company is committed to maintaining a strong balance sheet and generating consistent free cash flows [15] Management's Comments on Operating Environment and Future Outlook - Management noted that the current environment is impacting new commercial construction and causing delays in project decisions [27][39] - The outlook for Q4 indicates revenues roughly in line with the prior year, with expectations of mid-single-digit growth for the full year [16] - Management expressed confidence in the long-term demand drivers for roofing and restoration, citing aging infrastructure and increased weather events as key factors [34] Other Important Information - Cash flow from operations for the third quarter was over $125 million, with year-to-date cash flow totaling $330 million, a 65% increase year-over-year [13][14] - The company has a net debt of $985 million, with a leverage ratio of 1.7 times net debt to trailing 12 months EBITDA [15] Q&A Session Summary Question: Divergence in performance between Century Fire Protection and roofing business - Management explained that Century Fire Protection has a significant portion of its business in service, repair, and inspection, which is more resilient compared to roofing [18][19] Question: Margins in the Brands division - Management highlighted strong profitability in home improvement and Century Fire, despite challenges in restoration and roofing [20][21] Question: Market share gains in restoration - Management noted that efforts in positioning with national accounts and solidifying the account base have led to market share gains [23][24] Question: Outlook for FirstService Residential margins - Management indicated that while margin improvements have been significant, some tapering is expected in Q4 due to seasonal factors [25][26] Question: Impact of macroeconomic factors on roofing projects - Management acknowledged that macroeconomic stability is needed for improvement in commercial construction and project releases [27][34] Question: Competition for tuck-under deals - Management confirmed that the M&A environment remains competitive, particularly in fire protection and residential property management [29][31] Question: Backlog status in restoration business - Management reported that the backlog is stable but slightly down from last year, influenced by previous strong performance in Canada [40] Question: Performance in Florida for FirstService Residential - Management stated that Florida's performance is in line with expectations, with some budgetary pressures alleviated [41]

Core Viewpoint - FirstService (FSV) reported quarterly earnings of $1.76 per share, exceeding the Zacks Consensus Estimate of $1.75 per share, and showing an increase from $1.63 per share a year ago, indicating a positive earnings surprise of +0.57% [1] Financial Performance - The company posted revenues of $1.45 billion for the quarter ended September 2025, which was below the Zacks Consensus Estimate by 1.18%, but an increase from $1.4 billion year-over-year [2] - Over the last four quarters, FirstService has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Performance and Outlook - FirstService shares have increased by approximately 2.1% since the beginning of the year, while the S&P 500 has gained 13.9% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $1.47 on revenues of $1.44 billion, and for the current fiscal year, it is $5.87 on revenues of $5.57 billion [7] - The estimate revisions trend for FirstService was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Real Estate - Operations industry, to which FirstService belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Consolidated revenues for Q3 2025 were $1.45 billion, a 4% increase compared to Q3 2024[3] - Adjusted EBITDA for Q3 2025 was $164.8 million, reflecting a 3% increase year-over-year[3] - Adjusted EPS for Q3 2025 was $1.76, representing an 8% growth over the same quarter last year[3] - For the nine months ended September 30, 2025, consolidated revenues reached $4.11 billion, a 7% increase from the prior year[4] - Adjusted EBITDA for the nine months was $425.2 million, up 13% year-over-year[4] - Revenues for the three months ended September 30, 2025, reached $1,447,565,000, representing a growth of 3.7% compared to $1,396,041,000 in 2024[24] - Total revenues for 2025 reached $1,447,565, an increase from $1,396,041 in 2024, representing a growth of approximately 3.7%[29] - Adjusted EBITDA for 2025 was $164,780, compared to $159,974 in 2024, indicating a year-over-year increase of about 3.4%[29] - For the nine months ended September 30, 2025, consolidated revenues were $4,114,124, compared to $3,851,545 in the same period of 2024, marking a growth of around 6.8%[29] - Adjusted EBITDA for the nine months ended September 30, 2025, was $425,174, an increase from $375,834 in 2024, representing a growth of approximately 13.1%[29] Segment Performance - FirstService Residential revenues for Q3 2025 were $605.4 million, an 8% increase year-over-year, with organic growth of 5%[8] - FirstService Brands revenues for Q3 2025 were $842.1 million, a 1% increase, but organic revenues declined by 4%[10] - The company reported a decrease in operating earnings for the Residential segment in 2025, with a loss of $36,716 compared to a loss of $37,098 in 2024[29] - The Corporate segment showed an increase in adjusted EBITDA from $(16,234) in 2024 to $(13,384) in 2025, indicating improvement[29] Earnings and Profitability - GAAP diluted EPS for Q3 2025 was $1.24, down from $1.34 in the prior year[3] - Net earnings for the three months ended September 30, 2025, were $70,887,000, a decrease of 8.4% compared to $77,761,000 for the same period in 2024[22] - Adjusted net earnings for the three months ended September 30, 2025, increased to $80,812,000, up 9.4% from $73,769,000 in 2024[22] - Diluted earnings per share for the three months ended September 30, 2025, were $1.24, down from $1.34 in 2024[23] - Adjusted earnings per share for the nine months ended September 30, 2025, were $4.39, compared to $3.66 in 2024, reflecting a growth of 19.9%[23] - Operating earnings for 2025 amounted to $115,628, up from $125,902 in 2024, reflecting a decrease of approximately 8.2%[29] - Operating earnings for the nine months ended September 30, 2025, totaled $252,164, compared to $247,897 in 2024, showing an increase of about 1.3%[29] Cash Flow and Debt - Cash provided by operating activities for the three months ended September 30, 2025, was $126,362,000, an increase from $77,011,000 in 2024[27] - The company reported a total debt of $1,205,222,000 as of September 30, 2025, compared to $1,298,710,000 at the end of 2024[26] - The net cash used in investing activities for the three months ended September 30, 2025, was $79,504,000, compared to $26,861,000 in 2024[27] Assets and Goodwill - The company’s goodwill and intangible assets totaled $2,191,125,000 as of September 30, 2025, up from $2,110,866,000 at the end of 2024[26] - The company’s total assets increased to $4,385,356,000 as of September 30, 2025, from $4,194,852,000 at the end of 2024[26] Future Outlook - CEO Scott Patterson noted ongoing market challenges but expects solid growth and profitability for the year[5] - The company is focusing on market expansion and new product development as part of its growth strategy moving forward[29] - Future guidance indicates continued revenue growth, with expectations to exceed $1.5 billion in total revenues for 2026[29]

Core Insights - FirstService Corporation reported a consolidated revenue of $1.45 billion for Q3 2025, marking a 4% increase compared to Q3 2024 [2] - Adjusted EBITDA for the same quarter was $164.8 million, reflecting a 3% increase year-over-year, while Adjusted EPS grew by 8% to $1.76 [2][22] - For the nine months ending September 30, 2025, consolidated revenues reached $4.11 billion, a 7% increase from the previous year, with Adjusted EBITDA up 13% to $425.2 million [3] Financial Performance - Q3 2025 revenues were $1,447.6 million compared to $1,396.0 million in Q3 2024, with a GAAP Operating Earnings of $115.6 million, down from $125.9 million [2][23] - For the nine-month period, GAAP Operating Earnings were $252.2 million, slightly up from $247.9 million in the prior year [3][23] - The company reported a GAAP diluted EPS of $1.24 for Q3 2025, down from $1.34 in Q3 2024, while the nine-month diluted EPS increased to $2.32 from $2.26 [2][3][21] Segment Performance - FirstService Residential generated revenues of $605.4 million in Q3 2025, an 8% increase year-over-year, with an Adjusted EBITDA of $66.4 million, up 13% [7] - FirstService Brands reported revenues of $842.1 million for Q3 2025, a 1% increase, but experienced a 4% decline in organic revenue due to reduced activity in restoration and roofing operations [8] - Adjusted EBITDA for FirstService Brands was $102.1 million, down from $105.8 million in the prior year [8] Management Commentary - The CEO expressed satisfaction with the resilient growth in consolidated results despite facing weather-related and broader macroeconomic challenges [4] - The company anticipates continued market challenges impacting performance in Q4 but expects solid growth and profitability for the year [4] Company Overview - FirstService Corporation is a leader in the outsourced property services sector in North America, operating through two main platforms: FirstService Residential and FirstService Brands [5] - The company generates approximately $5.5 billion in annual revenues and employs over 30,000 individuals across North America [6]

Core Insights - FirstService Residential has renewed its partnership with Luxe, a high-rise condominium in Atlanta, to provide full-service management and 24/7 concierge services, emphasizing the company's leadership and resources [2][3][5] Group 1: Partnership Details - Luxe, consisting of 117 residences, has chosen FirstService Residential for its proven experience and support after previously transitioning to another management company [2][3] - The Luxe Board of Directors highlighted the importance of improving service quality, communication, and on-site staff support as key reasons for returning to FirstService Residential [5] Group 2: Property Features and Services - Luxe offers upscale living with amenities such as a 24/7 concierge, clubroom, fitness center, outdoor pool, pet park, and more, enhancing the resident experience [4] - FirstService Residential aims to enhance the overall health and value of the property through dedicated support and tailored services [6][8] Group 3: Company Overview - FirstService Residential is a leading property management company in North America, focusing on enhancing property value and resident life through a service-first philosophy [7][9] - The company provides 24/7 customer care and specialized programs to meet the unique needs of residential communities [8]