RBC raises Colliers stock target on spin-off possibility By Investing.com
RBC Capital Markets restated their buy rating on Colliers International (NASDAQ:CIGI) stock on Monday, upping their price target for the company to $174.00, up from their previous price target of $160.00. The company has maintained its Outperform rating in the real estate and investment management companies.
The update from RBC Capital comes amid speculation that Colliers International may spin off its Investment Management (IM) business into a separate publicly traded entity in the future.
While RBC Capital doesn't expect anything to happen anytime soon and doesn't know of any active plans for such a move, it suggests the concept could gain momentum.
This assumption is based on the high valuation values observed in both similar public companies and private market operations, in line with Colliers' ambitions to expand their IM business.
RBC Capital sees potential benefits and growth opportunities for Colliers in the event of a spin-off. The company refers to the successful precedent set by Colliers himself from FirstService Corporation (NASDAQ: ), which may be the model for IM's business strategy.
The new target price of $174.00 represents a 9% increase from the previous target, indicating RBC Capital's confidence in Colliers International's multiple value, regardless of whether the spin-off takes place. This adjustment underscores the firm's positive outlook on the company's future financial performance and growth prospects.
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