CBRE Group Inc (NYSE:CBRE) Emerges as a Top Affordable Growth Stock Pick

Investors looking for growth chances at fair prices often consider methods that mix expansion possibility with careful financial management. The "Affordable Growth" method focuses on companies showing good growth paths while keeping acceptable profitability and financial condition, all without having overly high valuations. This process tries to find businesses set for future growth that have not yet become too expensive due to market excitement, possibly providing improved risk-aware returns compared to high-growth stocks selling at high multiples.

CBRE GROUP INC - A (NYSE:CBRE) appears as a noteworthy candidate through this screening process, achieving a good 5 out of 10 in ChartMill's full fundamental rating system. The commercial real estate services leader shows the exact mix of qualities that affordable growth investors usually look for.

Growth Path

CBRE's growth outline is especially notable, receiving a growth rating of 7 that passes the screening requirement. The company shows solid growth in important measures:

• Revenue rose 14.96% over the last year, with an average yearly growth rate of 8.40% over recent years
• Earnings per share jumped 50.95% in the past year, though the five-year average is at a more measured 6.61%
• Future forecasts point to quickening growth with EPS anticipated to rise 18.49% each year
• Revenue growth is expected to continue its pace at 8.64% yearly

This mix of good past results and encouraging future estimates places CBRE suitably within the affordable growth structure, where continued growth is key for building future shareholder value.

Valuation Review

With a valuation rating of 5, CBRE presents what seems to be a fair valuation situation even with some varied signs:

• P/E ratio of 29.03 looks high alone but compares well to industry counterparts
• The company trades at a lower price than 78.46% of its real estate management and development competitors
• Forward P/E of 21.97 matches closely with the S&P 500 average of 22.63
• Enterprise Value to EBITDA and Price/Free Cash Flow ratios both show relative value compared to industry averages

The valuation view supports the affordable growth idea by showing that CBRE's growth possibilities are not completely reflected in the stock price, especially when measured against industry peers.

Financial Condition and Profitability

While growth and valuation guide the affordable growth choice, financial steadiness stays important for lasting expansion. CBRE scores 5 for financial condition and 6 for profitability, meeting the screening needs for satisfactory fundamental strength:

• Return on Equity of 13.21% is better than 95.38% of industry counterparts
• Return on Assets of 3.94% and Return on Invested Capital of 6.77% both place in the top group
• Altman-Z score of 3.59 shows financial health and limited bankruptcy danger
• Debt levels need watching, with a debt-to-equity ratio of 0.88 showing average borrowing

These measures confirm that CBRE keeps the financial base needed to back its growth plans without too much risk, a main part of the affordable growth method.

Investment Points

The mix of good growth signs, fair valuation compared to peers, and acceptable financial condition makes CBRE a notable candidate for investors searching for growth at sensible prices. The company's place in commercial real estate services gives contact to economic growth while its varied service offerings across advice, operations, project management, and investments build several income sources.

While margin concerns mentioned in the fundamental analysis deserve notice, the full view indicates a company performing well in its field while keeping valuation control. The quickening earnings growth forecasts especially back the growth part of the investment thesis.

For investors curious to research similar affordable growth chances, more screening outcomes can be found through our Affordable Growth Stock Screener.

Disclaimer: This analysis uses fundamental data and screening standards given by ChartMill.com and must not be taken as investment guidance. Investors must do their own research and think about their personal financial situations before making investment choices. Past results do not ensure future outcomes, and all investments hold risk including possible loss of original investment.