Analyst Note| Yousuf Hafuda |
Jones Lang LaSalle reported second-quarter results that demonstrate the dramatic nature of investment volume declines in the commercial real estate industry. Companywide fee revenue for the quarter was $1.2 billion, a 22% decline compared with the second quarter of 2019. The decline was driven by weak performance from the capital markets and leasing businesses, with outsourced corporate solutions displaying resilience. The current environment presents significant uncertainty for Jones Lang LaSalle, with the transaction-based nature of many of its business lines amplifying risk in the current environment. Despite the deterioration in performance, we are maintaining our $168 fair value estimate for narrow-moat-rated Jones Lang LaSalle, having already incorporated a period of near-term weakness into our valuation model.