CBG's 3Q Beats, As Expected

JP Morgan has published a research report on CB Richard Ellis Group (NYSE: CBG) following 3Q results that showed strong sales transaction revenues.

In the report, JP Morgan writes "We think expectations for the stock moved higher in recent weeks as anecdotal evidence suggested margin improvement and strong sales transaction revenue. This worked out to be the case, but if our recent feel for expectations is accurate, the stock may not see a big benefit from the news. From our point of view, we continue to like the CBG story. The sales transaction business is coming in stronger than expected, and we think the outlook for this business appears solid; CRE debt markets are well on their way to recovery around the globe, and cap rates have compressed (values are higher), which should lead to more transactions. The leasing business is performing well, although we worry about the pull-forward of demand due to early lease renewals in a low-rent environment."

JP Morgan maintains its Overweight rating and $22 price target.

CB Richard Ellis Group closed yesterday at $18.90.