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APi Group Corporation (APG)
NYSE:APG
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APi Group (APG) AI Stock Analysis

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APG

APi Group

(NYSE:APG)

Rating:78Outperform
Price Target:
$40.00
▲(15.14% Upside)
APi Group's strong financial performance and positive earnings call outlook are significant strengths. However, the high P/E ratio raises valuation concerns. Technical indicators and recent corporate events provide additional support but are secondary to financial health and earnings outlook.
Positive Factors
Financial Performance
APi Group reported a strong second quarter and raised guidance.
Operational Efficiency
Improved execution, consistent double-digit EBITDA growth, and measurable progress in safety and integration KPIs support a premium valuation.
Negative Factors
Market Competition
Competition for fire and life safety acquisitions remains elevated due to the large amount of private equity interest in the industry.
Profit Margins
Gross margins were adversely impacted by strong project starts, weather, and increased material costs.

APi Group (APG) vs. SPDR S&P 500 ETF (SPY)

APi Group Business Overview & Revenue Model

Company DescriptionAPi Group Corporation provides safety, specialty, and industrial services in North America, Europe, Australia, and the Asian-Pacific. It operates through three segments: Safety Services, Specialty Services, and Industrial Services. The Safety Services segment offers safety solutions focusing on end-to-end integrated occupancy systems, such as fire protection solutions; heating, ventilation, and air conditioning solutions; and entry systems, which include the design, installation, inspection, monitoring, and service of these integrated systems. The Specialty Services segment provides infrastructure and specialized industrial plant services, including maintenance and repair of underground electric, gas, water, sewer, and telecommunications infrastructure. This segment also offers engineering and design, fabrication, installation, and retrofitting and upgrading services. The Industrial Services segment provides various services and solutions comprising pipeline infrastructure, access and road construction, supporting facilities, and integrity management and maintenance to the energy industry focused on transmission and distribution. It serves customers in the public and private sectors, including commercial, industrial, fulfillment centers, distribution, manufacturing, education, healthcare, telecom, transmission, utilities, high tech, entertainment, retail, financial services, and governmental markets. The company was formerly known as J2 Acquisition Limited and changed its name to APi Group Corporation in October 2019. APi Group Corporation was founded in 1926 and is headquartered in New Brighton, Minnesota.
How the Company Makes MoneyAPi Group makes money through a diversified revenue model primarily based on providing essential services across its core sectors. The company's key revenue streams include service contracts for fire protection, HVAC installation and maintenance, and industrial cleaning services. These contracts often involve long-term agreements with businesses and government entities, ensuring a steady flow of income. Additionally, APi Group benefits from strategic partnerships and acquisitions that expand its service offerings and geographical reach. The company also capitalizes on cross-selling opportunities among its subsidiaries, enhancing its ability to meet client needs comprehensively and thereby increasing revenue potential.

APi Group Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q2-2025)
|
% Change Since: 0.93%|
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Positive
The earnings call highlighted APi Group's impressive record performance and strong growth in key segments such as Safety Services and Specialty Services. Despite challenges like margin pressures in the Specialty Services segment, the overall sentiment remains positive due to strategic M&A activity, robust backlog, and strong financial results.
Q2-2025 Updates
Positive Updates
Record Second Quarter Results
APi Group achieved record results in the second quarter of 2025 with net revenues increasing by 15% and organic growth of over 8%. The Safety Services segment delivered 80 basis points of segment earnings margin expansion, and the Specialty Services segment returned to 13.3% organic growth.
Strong Backlog and M&A Activity
APi recorded a backlog of over $4 billion for the first time in its history. The company also completed 6 acquisitions during the quarter, contributing to their guidance raise.
Inspection and Service Growth
The North American Safety business achieved double-digit inspection growth for the 20th straight quarter, and the international business showed high single-digit order growth.
Adjusted EBITDA Growth
Adjusted EBITDA increased by 17.7%, with a 30 basis point increase in adjusted EBITDA margin compared to the prior year period.
Negative Updates
Specialty Services Margin Decline
The Specialty Services segment experienced a 350 basis point decrease in adjusted gross margin due to increased project starts, rising material costs, and weather impacts.
Gross Margin Pressure
Overall adjusted gross margin decreased by 50 basis points compared to the prior year period, driven by mix, partially offset by pricing improvements.
Company Guidance
During APi Group's second quarter 2025 earnings call, the company provided updated guidance showing an optimistic outlook driven by strong performance metrics. The company raised its full-year net revenue guidance to a range of $7.65 billion to $7.85 billion, up from the previous $7.4 billion to $7.6 billion, reflecting organic growth of 4% to 7%. They also increased their full-year adjusted EBITDA guidance to a range of $1.005 billion to $1.045 billion, up from $985 million to $1.035 billion, indicating an approximate 15% growth at the midpoint. This upward revision was attributed to the company's robust second-quarter performance, which saw a 15% increase in net revenues to $2 billion compared to $1.73 billion in the prior year, with organic growth of 8.3%. The company also highlighted a 17.7% increase in adjusted EBITDA, reaching a margin of 13.7%, and adjusted diluted earnings per share rising by 18.2% to $0.39. These improvements were supported by strong project revenue growth, pricing enhancements, and the ongoing expansion of their inspection, service, and monitoring business, which achieved double-digit inspection growth for the 20th consecutive quarter. Additionally, APi Group's record backlog surpassed $4 billion, demonstrating significant business momentum as they continue to execute strategic initiatives, including accretive M&A activities and disciplined project selection.

APi Group Financial Statement Overview

Summary
APi Group exhibits strong financial health with consistent revenue growth, efficient cost management, and robust cash flow generation. The low leverage enhances financial stability, although there is room to improve profitability margins.
Income Statement
85
Very Positive
APi Group has demonstrated strong revenue growth, with a TTM revenue of $7.396 billion, reflecting a steady increase from previous years. The gross profit margin stands at 31.08%, signaling efficient cost management. The net profit margin of 3.24% and an EBIT margin of 6.56% indicate healthy profitability, although there is room for improvement. The EBITDA margin of 9.73% further underscores strong operational performance.
Balance Sheet
78
Positive
The company's financial stability is supported by a favorable debt-to-equity ratio of 0.002, highlighting minimal leverage risk. With a return on equity of 7.57%, APi Group effectively utilizes its equity base. The equity ratio of 37.13% suggests a solid equity buffer, although there's potential for optimizing asset utilization.
Cash Flow
82
Very Positive
APi Group's cash flow is robust, with a free cash flow growth rate of 6.16% indicating positive cash generation. The operating cash flow to net income ratio of 2.70 shows strong cash conversion from earnings. The free cash flow to net income ratio of 2.37 further supports the company's ability to generate free cash from operations.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue7.40B7.02B6.93B6.56B3.94B3.59B
Gross Profit2.24B2.18B1.94B1.71B939.00M756.00M
EBITDA839.00M484.00M680.00M532.00M338.00M131.00M
Net Income248.00M250.00M153.00M73.00M47.00M-153.00M
Balance Sheet
Total Assets8.54B8.15B7.59B8.09B5.16B4.07B
Cash, Cash Equivalents and Short-Term Investments432.00M499.00M479.00M605.00M1.19B515.00M
Total Debt3.06B3.04B2.57B3.03B1.87B1.54B
Total Liabilities5.37B5.20B4.72B5.96B2.84B2.51B
Stockholders Equity3.17B2.95B2.87B2.13B2.32B1.56B
Cash Flow
Free Cash Flow569.00M536.00M428.00M191.00M127.00M458.00M
Operating Cash Flow648.00M620.00M514.00M270.00M182.00M496.00M
Investing Cash Flow-346.00M-829.00M-115.00M-2.90B-121.00M-340.00M
Financing Cash Flow-213.00M245.00M-532.00M1.76B917.00M99.00M

APi Group Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price34.74
Price Trends
50DMA
33.62
Positive
100DMA
29.82
Positive
200DMA
27.26
Positive
Market Momentum
MACD
0.40
Positive
RSI
53.30
Neutral
STOCH
20.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APG, the sentiment is Neutral. The current price of 34.74 is below the 20-day moving average (MA) of 34.78, above the 50-day MA of 33.62, and above the 200-day MA of 27.26, indicating a neutral trend. The MACD of 0.40 indicates Positive momentum. The RSI at 53.30 is Neutral, neither overbought nor oversold. The STOCH value of 20.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for APG.

APi Group Risk Analysis

APi Group disclosed 47 risk factors in its most recent earnings report. APi Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

APi Group Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$15.74B23.6828.17%0.84%4.55%
78
Outperform
$9.79B46.2012.68%0.64%7.91%-25.17%
78
Outperform
$14.54B103.808.26%7.59%
78
Outperform
$11.67B19.9226.41%-0.77%4.34%
74
Outperform
$24.40B35.5340.09%0.22%26.33%63.32%
72
Outperform
$14.45B54.309.38%7.08%3273.27%
64
Neutral
$10.64B16.015.48%2.12%2.72%-24.90%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
APG
APi Group
34.74
12.29
54.74%
ACM
Aecom Technology
119.21
23.23
24.20%
FIX
Comfort Systems
694.43
379.58
120.56%
MTZ
MasTec
182.98
74.66
68.93%
TTEK
Tetra Tech
37.24
-8.82
-19.15%
BLD
TopBuild
413.17
39.52
10.58%

APi Group Corporate Events

Private Placements and FinancingStock Split
APi Group Announces Three-for-Two Stock Split
Positive
May 22, 2025

On May 20, 2025, APi Group DE, Inc., a subsidiary of APi Group Corporation, executed Amendment No. 8 to its Credit Agreement, increasing its revolving credit facility by $250 million to $750 million and extending its maturity date. The amendment also reduced interest margins and removed the credit spread adjustment, potentially lowering borrowing costs. On May 21, 2025, APi Group announced a three-for-two stock split of its common stock, effective June 30, 2025, which could enhance stock liquidity and accessibility for investors.

The most recent analyst rating on (APG) stock is a Buy with a $44.00 price target. To see the full list of analyst forecasts on APi Group stock, see the APG Stock Forecast page.

Stock SplitBusiness Operations and StrategyFinancial Disclosures
APi Group Announces Stock Split and Financial Targets
Positive
May 21, 2025

On May 21, 2025, APi Group Corporation announced new long-term financial targets and a three-for-two stock split. The company aims for $10 billion in net revenues and a 16% adjusted EBITDA margin by 2028, supported by a strong start in 2025. The stock split will increase the number of outstanding common shares to approximately 415 million, enhancing shareholder value.

The most recent analyst rating on (APG) stock is a Buy with a $44.00 price target. To see the full list of analyst forecasts on APi Group stock, see the APG Stock Forecast page.

Executive/Board ChangesShareholder Meetings
APi Group Holds Virtual Annual Meeting, Key Votes Approved
Positive
May 19, 2025

On May 16, 2025, APi Group held its Annual Meeting virtually, where shareholders voted on several key issues. The election of nine director nominees for a one-year term was approved, along with the ratification of KPMG LLP as the independent registered public accounting firm for the 2025 fiscal year. Additionally, shareholders approved the compensation of the company’s named executive officers and an amendment to increase the number of authorized shares of common stock. These decisions reflect strong shareholder support for the company’s current leadership and strategic direction.

The most recent analyst rating on (APG) stock is a Buy with a $44.00 price target. To see the full list of analyst forecasts on APi Group stock, see the APG Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 02, 2025