The equity market witnessed one of the biggest crashes after the COVID-19 pandemic struck Canada for the first time last year. With coronavirus cases rising again, long-term investors are likely to play cautiously and choose stocks wisely as uncertainty looms over the market.
The real estate sector in Canada skyrocketed in the past few months and garnered calls from experts for cooling down measures. Last week, the Canada Mortgage & Housing Corp. (CMHC) said that the activity in the residential real estate market will climb down to moderate from the 'unsustainable levels'. However, sales will remain at a higher pace and prices.
In this article, we a value real estate stock that has posted strong first-quarter fiscal 2021 earnings and also pays dividend to its shareholders.
Colliers International Group Inc's (TSX:CIGI)
Real estate company Colliers International Group Inc's (TSX:CIGI) operates in at least 60 countries. It posted strong first-quarter earnings in the first week of May, reporting revenue of US$ 774.9 million, up from US$ 630.6 million in the first quarter of 2020.
In Q1 2021, the adjusted earnings per share (EPS) were US$ 1.04, which represents an increase of 92.6 per cent from Q1 2020. The adjusted EBITDA increased to US$ 92.1 million from US$ 54.5 million in the same period.
The net earnings were US$ 24.8 million in the first quarter of this year and cash and cash equivalents amounted to US$ 118.5 million. In the past five days, over 146,000 shares traded hands on an average. The stock surged by 6.4 per cent in a week.
Six-month stock performance of Colliers International and RSI Momentum (Source: Refinitiv/Thomson Reuters)
In a year, the stock has grown by 104 per cent, surpassing the TSX 300 Composite Index, which grew by 55.5 per cent in comparison. The CIGI stock's year-to-date (YTD) growth is about 25 per cent.
The shares closed at C$ 141.52 apiece on May 7, five per cent down from its recent 52-week recent high of C$ 148.63 (May 4, 2021).
As per TMX, the company offers about 9 per cent return on equity (ROE) and its price-to-earnings (P/E) ratio is 88.3. On the dividend front, the real estate services company distributes US$ 0.05 semi-annually and its current dividend yield is 0.091 per cent.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.