CUSHMAN & WAKEFIELD LTD. (CWK): what the price requires
At today's price, CUSHMAN & WAKEFIELD LTD. (CWK) is priced for +12.4% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-19 · Source: https://boothcheck.com/report/CWK
Headline
| Field | Value |
|---|---|
| Ticker | CWK |
| Company | CUSHMAN & WAKEFIELD LTD. |
| Current price | $13.34/sh |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 2.4% |
| Operating margin today | 3.4% |
| Margin compression implied | -1.0pp |
| Implied growth | 12.4% |
| Multiple paid | 16x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 9.8% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~6.2pp.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -0.36σ |
| cohort percentile (of 82 peers) | 17 |
| sustained it ~5 years at this level | 50% |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by earnings-power and relative-multiple and growth-DCF value, while asset-based lands below the price. A value/asset-supported name, not a pure growth bet.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 6.20x | 5 | expensive |
| Earnings | 0.72x | 3 | justifies |
| Relative | 0.60x | 6 | justifies |
| Growth | 0.87x | 2 | justifies |
Families that justify the price: Earnings, Relative, Growth Families that call it expensive: Asset
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 5.2%); the inversion above states its own rate.
Per-Model Detail (n=16)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | — | — | no | — |
| DCF Exit Multiple | Growth | $21.43 | 0.62x | yes | Exit EV/EBITDA: 7.9x / 9.9x / 11.9x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $27.12 | 0.49x | yes | P/E 27.43x (blended: static sector reference 35x + trailing (TTM) 16x), scenarios: 22.7x / 27.4x / 32.2x (bear / base = reference held flat / bull), EV/EBITDA 15.96x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $3.42 | 3.90x | yes | BV/sh $8.39, ROE (TTM) 3.8%, ke 9.3% |
| Two-Stage Excess Return | Asset | $2.15 | 6.20x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $11.84 | 1.13x | yes | Rev $10.5B, growth 10% (input: historical growth; tapered), Terminal P/S: 0.2x / 0.3x / 0.3x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $12.45 | 1.07x | yes | FFO/share $0.83, growth 15% (input: historical FFO/share growth, 8y median), PEG=2.81 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $18.41 | 0.72x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.45B × (1−21%) / WACC 5.2% → EPV (no growth) |
| Residual Income | Asset | $1.63 | 8.18x | yes | BV $8.39 + 5yr PV of (ROE (TTM) 3.8% − Kₑ 9.3%) × BV; BV grows 2.5%/yr |
| Graham Number | Asset | $12.51 | 1.07x | yes | √(22.5 × FFO/share $0.83 × BVPS $8.39) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $38.04 | 0.35x | yes | EBITDA $0.57B × sector EV/EBITDA 20.0x |
| FCF Yield | Earnings | $0.01 | 1333.50x | yes | FCF $203.9M / Kₑ 9.3% — zero-growth perpetuity (excluded from median) |
| SBC-Adj FCF Yield | Earnings | $0.01 | 1333.50x | yes | SBC-adj FCF $0.15B (FCF $0.20B − SBC $0.06B) capitalized at Kₑ (excluded from median) |
| Ben Graham Formula | Earnings | $26.78 | 0.50x | yes | FFO/share $0.83 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $1.66 | 8.03x | yes | BV $8.39 × (ROIC 1.0% / WACC 5.2%) |
| P/Sales Sector | Relative | $266.70 | 0.05x | yes | Revenue $10.54B × sector P/S 6.0x |
| PEG Fair Value | Relative | $18.68 | 0.71x | yes | FFO/share $0.83 × (PEG 1.5 × growth 15.0% (input: historical FFO/share growth, 8y median)) → PE 22.5x |
| Earnings Yield | Earnings | $8.97 | 1.49x | yes | FFO/share $0.83 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | $11.72 | 1.14x | yes | FFO/share $0.83 × 14.2x P/FFO (route cohort median, n=85); FFO $0.19B (FFO incl. D&A + impairments, FY2025, companyfacts), shares 233M |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $2.3b |
| Net debt / NOPAT (after-tax) | 8.75x |
| Net debt / operating income (pre-tax) | 6.92x |
| Interest coverage | 1.6x |
| Share count CAGR (dilution) | 0.4% |
| Burning cash | no |
Bullet Takeaways
- Cushman & Wakefield is a commercial real estate services firm, not a property owner, so its earnings track transaction volume and outsourced facilities work rather than building values, and it benefits as "clients are choosing to outsource commercial real estate services to global firms".
- The defining risk is leverage into a cyclical business: net debt sits near five times operating profit with interest covered only about twice, so a downturn in leasing or capital-markets activity squeezes both earnings and the ability to service debt.
- Watch the deleveraging path and the leasing recovery; management reaffirmed full-year 2026 guidance of 15% to 20% adjusted earnings-per-share growth and a net-leverage target of 2 times by 2028.
Bull Case
What a book-value or asset multiple misses about Cushman & Wakefield is that there are almost no assets to value. This is a people-and-relationships business: it earns fees brokering leases, advising on property sales, and managing buildings for owners and occupiers. The right gauge is the fee stream and its operating leverage, not the balance sheet. And the fee stream just posted its best start to a year on record. First-quarter 2026 revenue reached $2.5 billion, up 11%, the highest first-quarter revenue in the company's history, with leasing revenue up 19% on strength across the Americas in office and industrial, including data centers. When transaction activity returns after a slow stretch, a brokerage's incremental margins are high because the cost base is already in place.
The recurring side of the business is the ballast under the cyclical brokerage. A large share of revenue comes from facilities and project management, work the company performs under multi-year outsourcing contracts where the fee may be "based on hours incurred, a percentage mark-up on actual costs incurred or a percentage of monthly gross receipts." Services revenue rose 9% in the quarter on higher facilities and project management. This is the steadier, contracted layer that keeps the lights on between transaction cycles, and the secular tailwind behind it is real: the 10-K notes that "clients are choosing to outsource commercial real estate services to global firms that can prov"ide scale across markets. Outsourcing concentrates the fragmented industry toward the few global platforms, and Cushman is one of three that can serve a multinational occupier everywhere it operates.
The operating leverage cuts in the company's favor as the cycle turns. Adjusted EBITDA rose 16% to $111.3 million in the quarter, faster than the 11% revenue growth, and management reaffirmed full-year guidance of 15% to 20% adjusted EPS growth. Liquidity is ample at $1.6 billion, and the company is paying down debt, with a planned $100 million partial redemption of its 2028 notes. A scaled global platform with a recurring services base, recovering transaction volumes, and earnings growing faster than revenue is a business geared to a commercial-real-estate recovery without owning a single building exposed to falling property values.
Bear Case
The valuation methods split sharply on Cushman & Wakefield, and reading why they disagree is the bear case. The asset-value methods, built on a thin $8.39 book value and a trailing return on equity under 4%, say the price is well above what the equity is worth on its books. The peer-multiple and earnings-power lenses are more generous. The honest reading of that split is that the price is leaning on a recovery in earnings, not on anything the balance sheet or current profitability supports, because a fee business with almost no hard assets and a low return on equity gives the conservative methods little to anchor on. When the methods that ignore the recovery and the methods that price it in diverge this far, the conservative ones describe what you own today: a thinly capitalized services firm in a still-recovering market.
The leverage is what turns that disagreement into a real risk. Net debt of about $2.3 billion sits at roughly five times trailing operating profit, and interest is covered only about 2.2 times. For a business whose revenue swings with the commercial-real-estate cycle, that is a demanding combination. The company itself flags its exposure: it carries "amounts outstanding under its Term Loans, 2028 Notes and 2031 Note"s and notes it is "expos"ed to interest-rate risk it manages with derivatives. In a strong leasing year the coverage is manageable. In a downturn, when transaction fees fall fastest, the fixed interest bill does not move, and the same operating leverage that powers the bull case in an upswing works against the equity on the way down.
What the price requires is for the recovery to keep going. Inverted, today's level pays roughly 16 times company-wide operating profit, implying about 11.5% operating growth a year for five years. That pace is within what the company has recently delivered as activity rebounded, so the rate is plausible; the question is duration, and only about half of comparable fast-growers sustained even five years at that level. The recovery is also concentrated where rates and demand cooperate. A reversal in office or capital-markets activity, or interest rates staying higher for longer, would slow the leasing rebound the price is extrapolating, and a levered, low-asset firm has less cushion to absorb that than the bull case assumes.
Valuation
This report assigns no fair value and no target. It works backward from the $12.89 price (June 27, 2026) to the assumption embedded in it, then measures the distance to each way of valuing the business, with the lens a services firm requires.
The first thing to read is why the methods disagree. Cushman & Wakefield owns almost no income-producing property; it earns fees. So the asset-value methods, anchored on an $8.39 book value and a sub-4% return on equity, produce figures well below the price, while the methods that capitalize the fee stream and credit its recovery sit closer to it. That spread is not a contradiction to resolve into one number; it is the information. It says the price is supported by an earnings recovery rather than by book value or current profitability. For a capital-light brokerage that is the normal shape, but it means there is little asset floor under the equity if the recovery stalls.
Inverting the price puts the bet in plain terms. At today's level the market is paying about 16 times company-wide operating profit, which implies roughly 11.5% operating growth a year for five years. The rate is within what the company has delivered as transaction activity rebounded; the stretch is in sustaining it, and only about half of comparable fast-growers held that pace for five years. The bet is a continued commercial-real-estate recovery, led by the leasing and capital-markets activity that drove the record first quarter.
Solvency is where the caution concentrates. Net debt near $2.3 billion is about five times operating profit, and interest coverage runs only about 2.2 times, against liquidity the company reported at $1.8 billion at year end, consisting of an undrawn $1.0 billion revolver and $0.8 billion of cash. The deleveraging plan, a stated net-leverage target of 2 times by 2028 and a partial redemption of the 2028 notes, is therefore central to the equity story: it is what would convert a recovering fee stream into a safer balance sheet. The price is paying for both the recovery and the deleveraging to proceed together; a stumble in either is what the conservative methods are warning about.
Catalysts
The clearest catalyst is the leasing and transaction recovery, and the first quarter showed it accelerating. Revenue of $2.5 billion was up 11%, a first-quarter record, with leasing up 19% on office and industrial strength including data centers, and services up 9% on facilities and project management. Reported earnings of $0.15 per share beat the $0.13 estimate, and adjusted EBITDA rose 16% to $111.3 million. Each quarterly print is now a direct read on whether the transaction rebound is broadening or stalling.
Deleveraging is the second catalyst and a measurable one. Management reaffirmed full-year 2026 guidance of 15% to 20% adjusted EPS growth and a three-year net-leverage target of 2 times by 2028, alongside $1.6 billion of liquidity and a planned $100 million partial redemption of its 6.750% notes due 2028. Progress on that redemption and on the leverage ratio is what would re-rate a levered services firm, so the next leverage update is an event worth watching.
The variable with the most leverage over both is the rate and demand backdrop for commercial real estate. Leasing volumes and capital-markets activity respond directly to interest rates and occupier confidence, so a shift in the rate path would move the fee stream faster than any internal initiative.
Peer Cohorts (Per Segment, With Filing Citations)
Core business (reported)
- CBRE (CBRE GROUP, INC.)
- FY2025 10-K: …and global competitors across all of our business lines and the geographies that we serve, and further industry consolidation, fragmentation or innovation could lead to significant future competition. We compete across a variety of business disciplines within the commercial real estate services and investment…
- FY2025 10-K: …and amortization expense decreased 6.3%, reflecting lower amortization expense due to intangible assets being fully amortized in 2024. 33 Table of Contents Real Estate Investments The following table summarizes our results of operations for our REI operating segment for the years ended December 31, 2025 and 2024…
- JLL (Jones Lang LaSalle Incorporated)
- FY2025 10-K: …may indicate a rate of growth or decline that might not have been consistent with the real underlying rate of growth or decline in the local operations. Consequently, we provide information about the impact of foreign currencies in the period-to-period comparisons of the reported results of operations in our…
- FY2025 10-K: , monitoring and compliance reporting. As sustainability becomes increasingly central to real estate decision-making, our capabilities allow us to help clients navigate this evolving landscape, create meaningful career opportunities for our employees, and generate value for our shareholders. COMPETITION We operate…
- CIGI (Colliers International Group Inc.)
- (no filing in the citation store)
- NMRK (NEWMARK GROUP, INC.)
- FY2025 10-K: …Real Estate Services Industry We operate in a highly competitive industry with numerous competitors, some of which may have greater financial and operational resources than we do. We compete to provide a variety of services within the commercial real estate industry. Each of these business disciplines is highly…
- FY2025 10-K: …than we are at growing through merger and acquisition activity. See the heading "Competition" under Part I, Item 1, Business for more information. In general, there can be no assurance that we will be able to continue to compete effectively with respect to any of our commercial real estate business lines or on an…
- FSV (FirstService Corporation)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
Cushman & Wakefield Q1 2026 results release