8 Most Undervalued Industrial Stocks to Buy According to Analysts

3) APi Group Corporation (NYSE:APG)

Forward P/E as of October 8: 14.33x

Number of Hedge Fund Holders: 52

Average Upside Potential: 34.04%

APi Group Corporation (NYSE:APG) offers safety and specialty services worldwide. The company operates via the Safety Services and Specialty Services segments.

APi Group Corporation (NYSE:APG) closed 6 bolt-on acquisitions, which include Elevated Facility Services and remains on track to achieve the long-term value creation targets. The company expects a positive business mix impact on margins and it is optimistic about reaching a 13% or more adjusted EBITDA margin by 2025. APi Group Corporation (NYSE:APG) targets to reduce net leverage below 2.5x by year-end while, at the same time, continuing its M&A strategy. It has ~$400 million remaining under the share repurchase authorization.

While APi Group Corporation (NYSE:APG) has opportunities in numerous sectors, the data center market has been identified as a critical growth driver. In the recent earnings call, the company highlighted that the backlog increase was driven mainly by organic growth, with a small portion from acquisitions. Given APi Group Corporation (NYSE:APG)’s focus on margin expansion, disciplined acquisition strategy, and organic growth, it is well-placed for a strong H2 2024.

Overall, the company’s long-term alliances, regulatory protections, and its reach to serve large-scale clients are expected to act as growth enablers for the long term. As per Wall Street analysts, the shares of APi Group Corporation (NYSE:APG) have an average price target of $41.40.

Greystone Capital Management, an investment management company, released its second-quarter 2024 investor letter. Here is what the fund said:

“APi Group Corporation (NYSE:APG) has been in and out of client portfolios since inception (mostly in) and has earned our trust by carrying over the founding culture of the business on its route to becoming public, while increasing their focus on growing the more durable and higher margin fire safety services segment.

The start of 2024 has been a busy one for APG with the recent retirement of their Series B Preferred stock, along with the acquisition of Elevated Facility Services Group, a leading provider of contractually based maintenance and repair services for elevator and escalator brands. I was thrilled to see this deal announcement given the revenue and EBITDA contributions, but also because management likely sees similar opportunities to grow non-discretionary recurring revenue by winning incremental service work…” (Click here to read the full text)