Colliers International Gr (CIGI.TO)

AI will take over their lower-level jobs, but what happens if/when the white-collar office staff goes into decline over time?

Down almost half from its peak. Hit by 2 areas:  commercial real estate and fears of AI impacting engineering. 

Could be good value as a long-term investment. Not something her firm would invest in. Yield is only 0.3%, and she wants a better yield for the risk. Commercial real estate is very economically sensitive. If you have a stronger risk appetite, could be a good entry point.

Trades at 11.5x PE, well off its 10-year average of close to 17x. Flat over last 5 years. Engineering, commercial real estate, and investment management. Sector's sold off on AI concerns. Management touts AI as a productivity/margin lever, with proprietary data being key.

Helpful to see what insiders are doing, but it doesn't always tell the story. 

Stock's just been thrown away. Trades at 11x PE for 2027. Four points lower PE than the banks, growing at 12%. Great quality business, good compounder. AI can replace parts of its business, but in the order of only 1 of the 20 steps needed for what they do. Real estate, engineering, investment management.

A name you can buy right now. Cheaper than it ought to be.

Price fell off a cliff, and that's what he likes about it. Just bought it. CEO is very, very good. Operates in over 30 countries. Three huge divisions:  real estate, engineering (just made an acquisition), and asset management (growing like crazy). Great balance sheet. Management owns ~30% of stock. 

Real estate's been beaten down, but people/institutions are still leasing properties and still need help managing those portfolios. Huge margin of safety on the downside, with lots of potential upside. Yield is 0.31%.

Insider buying is a strong signal. Likes the set-up here. The strong data centre build is very net positive for commercial real estate for years to come.

It sold off 25% over 4 days in February over fears that AI will replace human brokers. This is laughable. The CEO-chair bought $16 million of shares during that share, then bought another $29 million more. The company is expected to earn record EPS ever, yet shares are trading at its 50-year baseline. The share price is detached from fundamentals.

Everyone knows it for its real estate business. Based in Toronto, but global. Asset management business south of the border, but it's not commercial real estate. 

Its third arm is engineering services. Buying lots of smaller engineering companies. This division looking to double revenue in next 5 years. 

Management's great. Believes CEO just purchased a bunch more stock. Growthy name. Yield is 0.26%.

It has also been affected by the AI scare in that AI could replace human agents. However the business is driven by relationships and the trust factor is important. When it comes time to sign the deal, people wants humans, not AI. This will continue to be a human to human business.
Buy 8  Hold 4  Sell 0

Pummeled on fears of AI disruption and interest rates not coming down as fast as expected. Recent acquisition increased leverage (he sees that at 2x by 2027), and market fears debt issuance. Thinks recent acquisition looks accretive by 3%. 

Company states that its complex transactions can't possibly be outsourced to AI. Organic growth of 5-6%, plus 10% from acquisitions. Internal ownership is tight at 30%. Rate cuts would help. Secular play of growing urbanization, infrastructure, energy transition, and globalization. 

Sees 15% growth at 14x PE. Yield is 0.26%.

Has long owned this. Run by a great CEO. Not just real estate, but CIGI is into engineering and asset management. They buy companies and do well tucking them in. They are buying an engineering company. Is volatile, but a great compounder over time.

There's still upside. CIGI has benefited from rate cuts, since CIGI is in real estate. Peer CBRE announced strong results two weeks including double-digit revenue growth. There seems to be pent-up demand in the market. They use economic downturns not only to buy companies, but hire top talent. They have a record number of commercial RE brokers and agents.

A turnaround. Building recurring income. Owned since 1988. Great company. Hiccup last couple of years with real estate, rest is going well.

Globally diversified, with 50% of revenue from US. Profitability is 20% ROE, considerably higher than market average of 12% in Canada, and US average of 14%. More leverage than he's comfortable with. Share price has moved sideways for a couple of years. Virtually no yield, so you need capital appreciation to create alpha. 20x PE, quite expensive for a real estate company. He'd be interested around $120.