APG Stock Forecast & Price Target

APi Group Corp demonstrated a solid financial performance, with total revenues increasing by 6% year-over-year to $1.86 billion, surpassing consensus expectations, alongside a 16% year-over-year growth in earnings per share (EPS) to $0.51. The company has seen a notable expansion in its Specialty Services segment, with organic backlog growth indicating a robust pipeline that is likely to drive further growth in the upcoming quarters. Additionally, the shift towards a higher recurring service revenue mix is expected to enhance overall margins, with projections showing Safety EBITDA margins expanding to 16.1% and Specialty margins to 12.7% by FY25, supporting a favorable long-term outlook.

APi Group's financial outlook remains negative primarily due to significant project delays in its Specialty Services segment, which are forecasted to lead to a revenue decline of double digits in the first quarter of 2025. Additionally, the company faced a challenging environment in 2022, where its stock underperformed with a decline of 27%, adversely impacted by COVID-related restrictions and unfavorable foreign exchange fluctuations post-acquisition of Chubb. These factors have contributed to ongoing concerns about revenue generation and operational efficiency, as evidenced by lower revenue guidance and reliance on recovery from prior project setbacks.