Earnings to watch: Cushman & Wakefield (CWK) reports Q3 results tomorrow

What happened

Cushman & Wakefield, a real estate services firm, will report third-quarter earnings Wednesday before the market opens. Last quarter it reported revenue of $2.76 billion, up 11.2% from a year earlier, beating analysts' revenue expectations, with EBITDA above estimates and earnings per share in line. Analysts now expect revenue to grow 6.5% this quarter.

Confirmed

Global impact / market context

The report will show whether demand for real estate services is holding up as revenue growth is expected to slow to 6.5% from 11.2%. Because the company has missed Wall Street revenue estimates several times in the past two years, a weak result could push investors to sell shares, while a beat could restore confidence in the business.

Analyst inference

Peer results set a mixed bar: JLL grew revenue 11.8% and beat expectations by 1.5%, while Newmark grew 12.7%. Cushman is expected to grow more slowly at 6.5%, so its report will show whether it is losing ground to rivals or simply growing at a more conservative pace in the same property services market.

Analyst inference

What to watch

1. Watch whether reported revenue reaches the expected 6.5% year-on-year growth, and compare it with the 11.2% growth recorded in the same quarter last year. Confirmed
2. Watch profit measured by EBITDA, which means earnings before interest, taxes, depreciation and amortization, and earnings per share, since last quarter's EBITDA beat estimates while earnings per share merely matched. Analyst inference
3. Watch management's comments on leasing and property sales activity, because slower deal volumes would reduce fees and could force analysts to lower future revenue and profit estimates. Analyst inference

Evidence

• stockstory.org