FirstService Corporation (FSV): BCG Matrix [Dec-2025 Updated]

You're looking to see where FirstService Corporation's capital is best deployed right now, so let's cut straight to the portfolio map as of late 2025. The analysis shows a clear split: FirstService Residential is a reliable Cash Cow, pumping out $66.4 million in Q3 Adjusted EBITDA on 5% organic growth, providing the fuel for the rest of the business. Meanwhile, the real excitement is in the Stars, like Century Fire Protection with its double-digit growth, while other areas, like certain restoration units seeing a 4% organic dip, are clearly Dogs needing a hard look. The big question is how much investment-like the capital needed for the new Roofing Corp of America platform-will turn today's Question Marks into tomorrow's leaders.

Background of FirstService Corporation (FSV)

You're looking at FirstService Corporation (FSV) as of late 2025, a major player in North American outsourced property services. Honestly, the company's structure is pretty straightforward, operating through two main platforms: FirstService Residential and FirstService Brands. FirstService Residential is known as the largest manager of residential communities across North America, while FirstService Brands is a collection of company-owned and franchise systems providing essential property services.

To get a sense of scale, FirstService Corporation generated trailing twelve-month revenues ending September 30, 2025, of about $5.479 billion, which was an increase of 11.13% year-over-year. For the third quarter of 2025 specifically, consolidated revenues came in at $1.45 billion, marking a 4% increase compared to the prior year. The bottom line looked solid for the quarter, with Adjusted Earnings Per Share (EPS) hitting $1.76, an 8% jump year-over-year.

Let's break down those two platforms based on the latest reports. The FirstService Residential division has been showing consistent strength; for Q3 2025, its revenue increased by 8%, with organic growth contributing 5% of that. This suggests that the core community management business is performing quite well, even in a tougher environment.

Now, look at FirstService Brands. This division is a bit more mixed. In Q3 2025, its revenue grew by only 1% compared to the previous year, which the company noted was due to organic declines in restoration and roofing services, though fire protection performed strongly. For that quarter, Brands generated revenues of $842 million, with an EBITDA margin of 12.1%. The challenges in the Brands segment, particularly in restoration due to lower weather-related claims, are definitely something to watch as we map out the BCG quadrants.

The company's overall strategy seems to be a mix of organic growth in residential services and inorganic growth through acquisitions in the Brands segment, such as recent additions to the roofing portfolio. Management is guiding for mid-single-digit growth in consolidated annual revenues for 2025, so you can see the expectation for continued, but perhaps moderated, expansion.

FirstService Corporation (FSV) - BCG Matrix: Stars

You're looking at the components of FirstService Corporation (FSV) that are dominating their respective markets and pulling the entire organization forward. In the BCG framework, a Star is a business unit with a high market share in a market that is growing quickly. These units are leaders, but they aren't free cash generators yet; they consume significant cash to maintain that growth momentum.

Century Fire Protection, a key part of FirstService Brands, is definitely positioned as a Star based on its recent performance. This sub-segment shows strong, double-digit revenue growth in the latest reported quarter, Q3 2025. This performance is critical because it is actively offsetting organic declines elsewhere in Brands, making it a critical growth engine for the division.

The high-growth fire protection market segment demands continued investment to maintain its strong momentum and market position. The business model is sticky, providing essential, non-discretionary fire safety services with recurring revenue potential, which supports the high market share claim. Here's how Century Fire's growth stacks up against the broader FirstService Brands division and the consolidated corporation for the third quarter of 2025:

The need to invest heavily to keep this growth engine running is evident when you compare its performance to the rest of the Brands division. While Century Fire is delivering double-digit growth, the overall FirstService Brands division saw its organic revenues decline by 4% in Q3 2025. This disparity shows where the market share gains are concentrated and where capital must flow to secure future Cash Cow status.

For context on the overall company's financial position, which is funding this Star investment, FirstService Corporation reported:

• Consolidated Revenues for Q3 2025: $1.45 billion.
• Year-to-Date (9 months ended Sept 30, 2025) Revenues: $4.1 billion, a 7% increase year-over-year.
• Year-to-Date (9 months ended Sept 30, 2025) Adjusted EBITDA: $425 million, up 13% year-over-year.

The focus on converting these high-growth service revenues, like those from Century Fire Protection's robust repair, service, and inspection revenues, into sustained profitability is the key strategic action for this segment. If Century Fire maintains this success as the fire protection market matures, it is definitely positioned to transition into a Cash Cow.

FirstService Corporation (FSV) - BCG Matrix: Cash Cows

FirstService Residential (FSR) operates as a classic Cash Cow within FirstService Corporation (FSV), commanding a leading position in a mature, essential service market. This division is North America's largest residential community manager, a status supported by its established market presence.

The division delivered $605.4 million in revenue for the third quarter of 2025. This top-line performance reflected a total revenue increase of 8% compared to the prior year period, with organic growth settling at a steady 5%, which management attributed to securing new contract wins. The overall consolidated revenue for FirstService Corporation in Q3 2025 was $1.45 billion.

This high market share translates directly into consistent, high-margin cash flow generation. For the third quarter of 2025, FirstService Residential posted an Adjusted EBITDA of $66.4 million. This figure represents a year-over-year increase of 13%, demonstrating strong operational leverage and margin expansion within the segment. The recurring nature of property management fees underpins this financial stability.

The resilience of the recurring revenue stream is a key characteristic of this Cash Cow, providing the necessary capital base for the corporation. Key indicators of this stability include:

• Contract retention rates maintained above 95%.
• Year-over-year Adjusted EBITDA growth of 13% in Q3 2025.
• Generating $66.4 million in Adjusted EBITDA in Q3 2025.

FirstService Corporation (FSV) - BCG Matrix: Dogs

Dogs, are units or products with a low market share and low growth rates. They frequently break even, neither earning nor consuming much cash. Dogs are generally considered cash traps because businesses have money tied up in them, even though they bring back almost nothing in return. These business units are prime candidates for divestiture.

The restoration and roofing operations within FirstService Brands currently exhibit characteristics aligning with the Dog quadrant due to market volatility and external pressures. Organic revenue from certain restoration and roofing operations within FirstService Brands saw a $\mathbf{4\%}$ decline in Q3 2025. Performance in these areas is highly susceptible to external factors like minimal weather-related claims and commercial construction slowdowns.

These specific service lines require a defintely careful review for restructuring or divestiture to free up capital. The financial impact in Q3 2025 clearly illustrates the cash-trapping potential if these units do not see a material shift in market conditions or strategy. Expensive turn-around plans usually do not help when the market itself is the primary constraint.

Identifying specific regional or non-core franchise units that lack scale or competitive advantage in their local markets is the next step in this analysis. While segment-level data points to the problem, granular unit performance dictates the divestiture target. You need to look for units where the cost to maintain market share exceeds the potential return, especially given the current macroeconomic environment.

The primary indicators suggesting a Dog classification for certain units are:

• Low or negative organic revenue growth rates.
• High susceptibility to external factors like weather variability.
• Margin compression due to negative operating leverage.
• Reliance on non-core or highly cyclical service lines.
• Units that do not contribute meaningfully to the overall $\mathbf{13\%}$ Adjusted EBITDA increase for the consolidated company.

The overall FirstService Corporation reported consolidated revenues up $\mathbf{4\%}$ in Q3 2025, making the $\mathbf{-4\%}$ organic decline in this specific part of the Brands division a significant drag. Finance: draft 13-week cash view for non-core Brands units by Friday.

FirstService Corporation (FSV) - BCG Matrix: Question Marks

Question Marks in FirstService Corporation's portfolio are business units operating in high-growth, fragmented markets but currently hold a relatively low market share, thus consuming significant capital for expansion.

Roofing Corp of America (RCA), established as a new platform with the acquisition in December 2023, fits this profile. The North American commercial roofing market is valued at approximately $45 billion, characterized by its highly fragmented nature where market leaders command only about 1-2% share. FirstService Corporation's acquisition positioned it as a Top 5 Player in this space. RCA added approximately $400 million in annual revenues to the company upon acquisition, operating with low double-digit EBITDA margins. Despite the high-potential market, RCA operations experienced lower quarter-over-quarter results in the second quarter of 2025, and the segment saw organic revenue declines in the third quarter of 2025.

The restoration business, encompassing Paul Davis and First Onsite, also represents a Question Mark due to its fragmented market structure and ongoing acquisition strategy to build share. In 2024, these brands generated 5% organic growth overall, or over 10% when adjusting for significant weather events. However, for the second quarter of 2025, the combined organic growth for these two restoration brands was only 2%, and revenues for the entire Restoration division were projected to be down 5% to 10% versus the prior year due to high comparatives from weather events in the prior period. The strategy here involves active tuck-under acquisitions, such as the three completed in early 2024, to quickly build market presence in this large, fragmented industry.

These segments require substantial capital deployment to rapidly increase market share, which is the core challenge for a Question Mark. In 2024, FirstService Corporation deployed a total of $212 million in capital for acquisitions, including tuck-unders for RCA in the Florida market. The company entered 2025 with significant liquidity, supported by an expanded unsecured revolving credit facility increased to USD 1.75 billion in February 2025, providing the necessary cash to fund these growth investments.

The overall performance of the FirstService Brands division underscores the investment need. While consolidated revenues for the second quarter of 2025 grew 9% year-over-year to $1.42 billion, the organic revenue growth for the Brands division was only 1% in Q2 2025, and it subsequently saw an organic revenue decline of 4% in Q3 2025. This suggests that without heavy investment via acquisitions, these units risk becoming Dogs.

Key financial and statistical data points for these Question Mark areas:

The strategic imperative for these units centers on rapid market share capture:

• Invest heavily in RCA tuck-unders to secure leadership in the $45 billion market.
• Continue pursuing restoration tuck-unders to boost organic growth, which was only 2% combined in Q2 2025.
• Address the Q3 2025 organic decline of 4% in the broader Brands division.
• Utilize the $1.75 billion credit facility capacity to fund necessary M&A activity.