Last Updated: 16 Sep 2024
Executive Summary
Api Group Corp (APG) is a leading provider of security, specialty, and industrial services in North America. Despite recent challenges, the company's strong fundamentals and growth potential make it an attractive investment opportunity.
Company Overview
Headquartered in New Brighton, Minnesota, Api Group provides a wide range of services, including:
Security and fire protection systems
Electrical and mechanical construction
Industrial maintenance and repair
Specialty services (e.g., roofing, painting, flooring)
The company's customer base includes commercial, industrial, and government clients.
Fundamental Analysis
Revenue: Api Group reported revenue of $6.87 billion in the trailing twelve months (TTM), a slight decrease of 0.023% year-over-year.
Profitability: The company's profit margin is a modest 2.81%, with an operating margin of 7.46%. Earnings per share (EPS) for the TTM were -$1.87.
Valuation: At a current stock price of $34.47, Api Group trades at a forward price-to-earnings (PE) ratio of 15.38, which is within the industry average. The price-to-sales ratio is 1.377, indicating that the company is relatively undervalued compared to peers.
Return on Equity: The company's return on equity (ROE) for the TTM is 6.57%, which is below the industry average.
Technical Analysis
Trend: Api Group's stock price has been in a downtrend since early 2023, forming a series of lower highs and lower lows.
Support and Resistance: The stock is currently trading near a support level of $34.00. Resistance is located at $36.00.
Moving Averages: The 50-day moving average is currently at $35.33, while the 200-day moving average is at $35.60. Both moving averages are trending downward, indicating a bearish bias.
Short Term Outlook
In the short term, Api Group's stock price is likely to remain under pressure due to the ongoing downtrend and weak technical indicators. The stock may test the support level at $34.00 before potentially rebounding.
Long Term Outlook
Despite the current challenges, Api Group's long-term outlook is positive. The company has a strong market position, a diversified customer base, and a solid financial foundation. As the economy recovers, the company is well-positioned to benefit from increased demand for its services.
Analyst Recommendations
Analysts are generally bullish on Api Group's long-term prospects. Four analysts recommend a "Strong Buy" rating, while three recommend a "Buy" rating. The average analyst target price is $44.63, implying a potential upside of over 29%.
