Api Group Intrinsic Value – Creative Planning reduces APi Group Co. holdings by 39.4% in third quarter disclosure

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API ($NYSE:APG): Creative Planning is a renowned financial planning and investment management firm that offers customized solutions to its clients. One of their recent disclosures has caught the attention of many investors, as it reveals a significant reduction in their holdings in APi Group Co. during the third quarter of the year. This revelation has sparked discussions and sparked curiosity about the company and its current state. For those who are not familiar, APi Group Co. is a leading provider of construction services, industrial maintenance, and specialty services. APi Group Co. has a diverse portfolio, serving various industries such as energy, healthcare, and infrastructure, making it an attractive investment option for many.

However, Creative Planning’s latest disclosure shows a decrease of 39.4% in their investments in APi Group Co. during the third quarter. This significant reduction raises questions about the reasons behind such a move. It is essential to note that Creative Planning holds a considerable influence in the financial world, and their decisions often have an impact on the market. One possible explanation for this decrease in investments could be due to Creative Planning’s portfolio diversification strategy. As a responsible and experienced financial planning firm, Creative Planning continuously reviews and adjusts its holdings to ensure a well-balanced and diversified portfolio for its clients. This reduction could be a strategic move to mitigate risks and optimize returns for their clients. Another aspect that could have contributed to this decrease is the overall performance of APi Group Co. During the third quarter, the company’s stock prices saw some fluctuations, which could have caused concerns for investors like Creative Planning. It is common for financial institutions to make necessary adjustments to their holdings based on market conditions and company performance. While the exact reasons for this move are not entirely clear, it could be a strategic decision to maintain a well-diversified portfolio or due to the company’s performance. As the market continues to monitor APi Group Co.’s progress, it will be interesting to see how this change in holdings will affect the company’s future.

Analysis – Api Group Intrinsic Value

After thoroughly examining the financial reports of API GROUP, our team at GoodWhale has come to the conclusion that the current fair value of API GROUP share is approximately $27.1. This valuation has been calculated using our proprietary Valuation Line, taking into account the company’s financial performance and market trends. However, we have observed that the stock of API GROUP is currently trading at a significantly higher price of $35.34. This represents an overvaluation of approximately 30.6% compared to our calculated fair value. This suggests that the market has priced in optimistic expectations for the company’s future growth and profitability. Upon further analysis, we have found that there are certain key factors driving this overvaluation. Firstly, API GROUP has recently announced strong financial results and positive developments in their product pipeline. This has led to increased investor confidence and demand for their stock, thus driving up the price. Additionally, the market’s overall sentiment for the industry in which API GROUP operates may also be contributing to the overvaluation. The industry as a whole may be experiencing a period of growth and positive outlook, leading to a higher valuation for all companies within it. However, it is important to note that this overvaluation also presents a potential risk for investors. If the company does not meet the high expectations set by the market, there is a possibility for a drop in stock price, resulting in losses for investors. In conclusion, based on our evaluation, the current stock price of API GROUP seems to be overvalued and may not reflect its true fair value. Investors should carefully consider the risks and conduct their own research before making any investment decisions. As always, we at GoodWhale will continue to monitor API GROUP’s performance and provide updates on any significant changes in our valuation. More…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Api Group. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Api Group. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Api Group. More…

Key Ratios Snapshot

Some of the financial key ratios for Api Group are shown below. More…

Peers

In the engineering and construction industry, APi Group Corp competes with Primoris Services Corp, MasTec Inc, and SPIE SA. All four companies are large, international firms that provide a variety of engineering, construction, and maintenance services. While all four companies are fierce competitors, APi Group Corp has consistently been one of the top performers in the industry.

– Primoris Services Corp ($NASDAQ:PRIM)

Primoris Services Corporation is a leading provider of specialty contracting services operating in the United States, Canada, and Mexico. The company’s specialty contracting services include pipeline construction and maintenance, facilities construction, civil construction, offshore pipeline construction, and direct hire construction. The company’s operations are organized into three business segments: Specialty Contracting, Engineering, and Power. The company’s Specialty Contracting segment is the largest and most diversified segment, providing a full range of services to major oil and gas companies, midstream operators, utilities, and other customers. The company’s Engineering segment provides engineering, procurement, and construction management services to the power generation, petrochemical, refining, and other industries. The company’s Power segment provides power plant operations, maintenance, and other services to the electric utility industry.

– MasTec Inc ($NYSE:MTZ)

MasTec Inc is a publicly traded infrastructure engineering and construction company in the United States. The company operates in five segments: Utility Transmission, Oil and Gas, Electrical Transmission, Wireless Transmission, and Industrial. MasTec’s Utility Transmission segment focuses on the engineering, procurement and construction of electric utility transmission lines and substations. The Oil and Gas segment provides a range of services for the exploration, development, production, gathering and transportation of oil and gas. The Electrical Transmission segment focuses on the engineering, procurement and construction of high-voltage power lines and substations. The Wireless Transmission segment focuses on the design, installation and maintenance of wireless communications systems. The Industrial segment provides a range of services for the construction of industrial plants and facilities.

– SPIE SA ($LTS:0R8M)

SPIE SA is a French-based company that provides services for the oil and gas industry. The company has a market capitalization of 3.84 billion as of 2022 and a return on equity of 12.83%. SPIE SA is involved in the exploration, production, and transportation of oil and gas. The company also provides services for the mining industry.

Summary

This suggests that Creative Planning may have a negative outlook on the company’s future performance and potential for growth. However, on the same day as the disclosure, APi Group Co.’s stock price rose. This conflicting information could indicate differing opinions on the company’s prospects among investors. It may be worthwhile for potential investors to further investigate APi Group Co.’s financials and market trends before making any investment decisions.