Last Update 20 Dec 25

Fair value Increased 1.15%

CBRE: Gradual Brokerage Recovery And Buybacks Will Drive Future Upside

Analysts raised their price target on CBRE Group by about $2 to approximately $183 per share, citing a steadily improving real estate brokerage environment and slightly higher valuation multiples, despite only modest adjustments to growth and profitability assumptions.

Analyst Commentary

Recent commentary from bullish analysts frames the higher price targets as a reflection of a steady, if moderating, recovery in U.S. real estate brokerage activity, with the current valuation seen as reasonable relative to CBRE Group's execution and cash generation profile.

Bullish analysts note that transaction volumes and advisory pipelines are stabilizing, supporting a more constructive view on near to medium term revenue growth and margin resilience, even if the pace of recovery is not as rapid as in prior cycles.

At the same time, there is recognition that the move higher in the stock has already captured much of the near term improvement, leading some to temper their enthusiasm and maintain more neutral overall stances despite lifting price targets.

Against this backdrop, investor focus is shifting toward how effectively CBRE Group can translate a gradual market rebound into consistent earnings growth and incremental operating leverage.

Bullish Takeaways

Bullish analysts view the recent target increases as confirmation that improving brokerage conditions and a more supportive macro backdrop can sustain mid single digit to high single digit revenue growth over the next several years.
The moderation in the recovery is seen as manageable, with diversified service lines and recurring revenue streams expected to smooth earnings and support a premium valuation multiple compared with smaller, more cyclical peers.
Operational discipline and cost controls during the downturn are perceived as positioning the company to capture operating leverage as deal activity gradually normalizes, reinforcing confidence in upside to current profit expectations.
Balance sheet flexibility and continued capital deployment into higher growth, fee based segments are cited as additional supports for long term growth and multiple expansion.

Bearish Takeaways

Bearish analysts highlight that the recovery trajectory is moderating rather than accelerating, which could cap near term upside to earnings growth and justify only incremental moves higher in target prices.
There is concern that the current valuation already embeds an optimistic path for transaction and leasing volumes, leaving the shares vulnerable if macro conditions or interest rates delay a more robust rebound in activity.
Execution risk remains a focus, with questions around the pace at which cyclical brokerage revenue can re accelerate relative to the fixed cost base, potentially limiting margin expansion in the near term.
Some investors remain cautious about the sensitivity of the business to future rate moves and capital markets volatility, which could re introduce pressure on valuations if market sentiment deteriorates.

What's in the News

CBRE Group completed the repurchase of 41.9 million shares, or about 13.5% of its share count, under the buyback program announced in November 2021, deploying roughly $3.9 billion in total capital (company filing).
No additional shares were repurchased between July 1 and September 30, 2025, indicating a pause in buybacks as management weighs capital allocation options (company filing).
Management reiterated that mergers and acquisitions and co investments in Real Estate Investments remain the top capital allocation priorities, ahead of share repurchases (earnings call).
CFO Emma Giamartino stated that CBRE continues to view its share price as undervalued and will resume buybacks in the absence of attractive M&A opportunities (earnings call).
CBRE is actively advancing its M&A strategy, focusing on resilient, secular growth areas and highly operated targets that can benefit from integration into the CBRE platform (earnings call).

Valuation Changes

Fair Value Estimate has risen slightly from approximately $180.50 to about $182.58 per share, reflecting a modestly higher intrinsic valuation.
Discount Rate has fallen slightly from about 9.30% to roughly 9.23%, indicating a marginally lower required return embedded in the model.
Revenue Growth has remained essentially unchanged at approximately 9.77%, implying stable long term top line expectations.
Net Profit Margin has slipped slightly from roughly 4.68% to about 4.63%, signaling a modest reduction in projected profitability.
Future P/E multiple has increased slightly from about 27.6x to roughly 28.2x, suggesting a small expansion in the valuation multiple applied to forward earnings.

Strategic realignment, resilient business focus, and integration of acquisitions enhance growth, margins, and operational synergies, driving stable revenue despite market uncertainties.
Strong cash flow supports aggressive investments, M&A, and share repurchases, promising EPS growth and increased shareholder value amid favorable market conditions.
Economic and market uncertainties, including tariffs, interest rates, and leasing slowdowns, threaten CBRE's revenue growth and strategic initiatives.

Catalysts

About CBRE Group

Operates as a commercial real estate services and investment company in the United States, the United Kingdom, and internationally.What are the underlying business or industry changes driving this perspective?

CBRE's strategic realignment of its Project Management and Building Operations & Experience segments has resulted in strong financial performance and is expected to drive future growth by enhancing operational synergies, including shared client access and opportunities for mergers and acquisitions. This is likely to positively impact both revenue and net margins.
The increased focus on resilient businesses, which now make up over 60% of CBRE's total SOP, is expected to provide stable net revenue growth, even amidst market uncertainties, likely improving net margins due to enhanced operating leverage and cost efficiencies.
The strong balance sheet and improved cash flow position allow CBRE to invest aggressively in M&A and principal investments, potentially driving higher future earnings and improved financial performance during economic downturns.
CBRE's successful integration of Turner & Townsend is projected to enhance the project management segment's growth and margin profile over time, providing increased SOP margins and contributing to earnings growth through operational synergies and efficiency gains.
Continued investments in high-demand sectors such as data centers and strategic geographic markets, alongside capital deployment in share repurchases and M&A, are expected to deliver long-term EPS growth and shareholder value, leveraging favorable market conditions and strategic positioning.

CBRE Group Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming CBRE Group's revenue will grow by 9.5% annually over the next 3 years.
Analysts assume that profit margins will increase from 2.9% today to 4.5% in 3 years time.
Analysts expect earnings to reach $2.3 billion (and earnings per share of $7.95) by about September 2028, up from $1.1 billion today. However, there is some disagreement amongst the analysts with the more bearish ones expecting earnings as low as $1.9 billion.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 26.2x on those 2028 earnings, down from 43.6x today. This future PE is greater than the current PE for the US Real Estate industry at 25.8x.
Analysts expect the number of shares outstanding to decline by 2.56% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 8.91%, as per the Simply Wall St company report.

CBRE Group Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Tariff-related uncertainty could dampen the outlook and slow down CBRE's transactional business, potentially impacting revenue growth.
The market's exposure to interest rate volatility and the risk of recession may lead to delays or cancellations in capital raising and corporate project management, affecting net margins.
The slowdown in large leasing deals, particularly in industrial segments, could lead to lower-than-expected leasing revenues.
Potential currency headwinds, although currently reversing, may still affect the company's global earnings depending on future foreign exchange fluctuations.
Persistent global economic uncertainty could lead to reduced investor confidence and a cautious approach to M&A and capital deployment, affecting earnings and strategic growth.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $169.727 for CBRE Group based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $197.0, and the most bearish reporting a price target of just $115.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $50.0 billion, earnings will come to $2.3 billion, and it would be trading on a PE ratio of 26.2x, assuming you use a discount rate of 8.9%.
Given the current share price of $162.09, the analyst price target of $169.73 is 4.5% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Margin Resilience And Share Buybacks Will Shape Sector Recovery Ahead