Buy Rating Reaffirmed on Improving 2026 Setup, Segment Resilience, and Upside from Valuation Normalization and Storm-Driven Recovery

TD Cowen analyst Tim James maintained a Buy rating on FirstService today and set a price target of $211.00.

Tim James has given his Buy rating due to a combination of factors that point to improving fundamentals and a more favorable setup for 2026. He expects management’s full-year 2026 outlook, guidance for Roofing organic growth, and updated Restoration commentary to signal a recovery from 2025 headwinds, supporting forecasted high-single-digit growth in both adjusted EBITDA and adjusted EPS. The stock’s limited sensitivity to trade, tariff, and political risks, along with an anticipated return of valuation multiples toward historical levels, underpins his conviction in upside potential. In addition, his target price remains unchanged at $211, with only immaterial modeling tweaks related to currency and macro assumptions, reinforcing the stability of his investment thesis.
James also highlights the contrasting but complementary dynamics of the company’s two main segments. In FirstService Residential, he projects solid high‑single‑digit revenue growth and double‑digit adjusted EBITDA expansion, driven by mid‑single‑digit organic growth, steady margins, and incremental contributions from M&A, underscoring the segment’s resilience and predictability. While FirstService Brands is expected to finish 2025 with weaker results due to macro‑driven softness in large Roofing projects and tough storm‑related comparables in Restoration, he views these pressures as largely transitory. He further notes that a normalization of named‑storm activity—illustrated by the potential impact of Winter Storm Fern—could provide upside to 2026 revenue and earnings relative to current expectations, adding an additional catalyst to support the Buy rating.

In another report released on January 21, Scotiabank also maintained a Buy rating on the stock with a $205.00 price target.