-- The macro backdrop this year has been increasingly murky with continued weak commercial construction activity, interest rate volatility, and record low consumer sentiment amid the Iran war, notes Stifel Canada.
However, analyst Daryl Young sees the majority of First Service's (FSV.TO, FSV) revenue as economically resilient. Young, who is maintaining a buy rating and US$215.00 price target on the stock, says FirstService has also set the bar sufficiently low for 2026 in terms of mid-single-digit organic growth.
In 2026, restoration should benefit from inclement winter weather to start the year, while Stifel Canada's roofing survey points to signs of the industry stabilizing (albeit still very challenging). The company has a very strong balance sheet and is poised to play offense should private equity challenges lead to a more attractive M&A environment, Young adds.
FirstService reports its fourth-quarter earnings on April 23. Young is forecasting fourth-quarter revenue growth of 4.2% y/y, underpinned by 1.8% M&A growth and 2.4% organic growth.
Price: $205.41, Change: $+0.38, Percent Change: +0.19%