2023-05-17 10:08:05 ET
APi Group ( NYSE: APG ) on Wednesday was upgraded to Outperform from a prior investment rating of Neutral by analysts at financial services firm Baird. They said the provider of safety, specialty and industrial services is poised to increase profitability and recurring revenue.
“The best service companies take share over time through great customer service reflected in strong customer retention service stemming from a high-performance culture. This cannot be described. It can only be ‘experienced,’” Andrew J. Wittmann, analyst at Baird, said in a May 17 report. “Our recent field trip/site visit helped us develop greater appreciation for APG’s culture, at least domestically (its largest business).”
Baird raised its price target for APi ( APG ) to $29 a share from $27 a share, based on a multiple of 11 times forward-12-month EBITDA, discounted from peer companies such as Emcor Group ( EME ) and Comfort Systems USA ( FIX ).
“APi Group’s ( APG ) statutorily mandated inspection services (and resulting services work) are effectively recurring in nature and comprise approximately 50% of revenue,” according to Baird.
APi Group ( APG ) has risen 32% in the past 12 months, contrasting with a 2.6% decline for the Standard & Poor's 400 midcap stock index ( SP400 ).
Seeking Alpha contributor Mayank N. Sharma has a Buy rating on APi Group ( APG ) based on its improved profitability .
More about APi Group
- APi Group announces recent $200M debt paydown
- Honeywell, Emerson, GE are among top industrial stock picks at BofA
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APi Group upgraded to Outperform at Baird on earnings outlook