Oppenheimer analyst Ian Zaffino maintained a Buy rating on Servicemaster Global Holdings (SERV) yesterday and set a price target of $47. The company’s shares closed yesterday at $41.14, close to its 52-week low of $39.41.
Zaffino noted:
“The overarching theme surrounded long-term and sustainable growth, consistent with Nik Varty’s message since he joined July 2017. A “servant leadership” mindset should drive better front-line interactions, which in turn, should drive a better customer experience and higher retention. Management intends to pivot toward Pest, given their higher “life value rankings,” vs. Residential Pest. Terminix top line should ultimately grow 5%+ (vs. 1.2% in 2018E YTD) with incremental EBITDA margins of ~30% (vs. ~22.7% overall in 2018E). To account for the new $9M Salesforce investment, spin-off headwinds of $14M YoY (vs. our $10M) and the Assured acquisition, we adjust FY19E EBITDA to $443M, from $460M.”
According to TipRanks.com, Zaffino is a 1-star analyst with an average return of -1.1% and a 47.7% success rate. Zaffino covers the Services sector, focusing on stocks such as Wyndham Hotels & Resorts Inc, Wyndham Destinations Inc, and frontdoor inc.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Servicemaster Global Holdings with a $45.63 average price target.
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Based on Servicemaster Global Holdings’ latest earnings release for the quarter ending September 30, the company reported a quarterly revenue of $873 million and net profit of $71 million. In comparison, last year the company earned revenue of $797 million and had a net profit of $80 million.
Based on the recent corporate insider activity of 33 insiders, corporate insider sentiment is negative on the stock.
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ServiceMaster Global Holdings, Inc. engages in the provision of residential and commercial services. It operates through the following segments: Terminix, American Home Shield, and Franchise Services Group. The Terminix segment provides termite and pest control services to residential and commercial customers; as well as distributes pest control products.
