Analyst Note| Michael Wong, CFA, CPA |
Narrow-moat-rated Jones Lang LaSalle posted encouraging first-quarter results as the commercial estate market continues to rebound from the effects of the pandemic, which essentially brought the industry to a grinding halt last year. We are increasingly seeing evidence of a broad-based recovery in the global commercial real estate market with steady improvement in investment, rent collection, and leasing activity. JLL reported first-quarter companywide fee revenue of $1.44 billion, only a 4% decrease from $1.50 billion during the first quarter of 2020. Adjusted EBITDA increased to $190 million, almost doubling the $96 million in the same period last year. The adjusted EBITDA margin for the first quarter, calculated on a fee revenue basis, was 13.2% compared with 6.4% in the first quarter of 2020. Management expects the adjusted EBITDA margin to be in the 14%-16% target range for the full year. We do not plan to materially alter our $191 fair value estimate as we fully incorporate these results.