Earnings results often indicate what direction a company will take in the months ahead. With Q4 behind us, let’s have a look at Compass (NYSE:COMP) and its peers.
Technology has been a double-edged sword in real estate services. On the one hand, internet listings are effective at disseminating information far and wide, casting a wide net for buyers and sellers to increase the chances of transactions. On the other hand, digitization in the real estate market could potentially disintermediate key players like agents who use information asymmetries to their advantage.
The 13 real estate services stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 5.5% while next quarter’s revenue guidance was 1.2% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 10.2% since the latest earnings results.
Compass (NYSE:COMP)
Fueled by its mission to replace the "paper-driven, antiquated workflow" of buying a house, Compass (NYSE:COMP) is a digital-first company operating a residential real estate brokerage in the United States.
Compass reported revenues of $1.38 billion, up 25.9% year on year. This print exceeded analysts’ expectations by 3.4%. Overall, it was a strong quarter for the company with EBITDA guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EPS estimates.
"Despite a year in which resale transactions experienced a 29-year low, Compass grew both Revenue and Adjusted EBITDA2 significantly and delivered $122 million in operating cash flow, or $150 million prior to the NAR-related settlement payment. As the market recovers, we believe the combination of our cost discipline and structural advantages, which include our end-to-end proprietary technology platform, national scale, network of top agents, and depth of inventory, positions Compass to capture significant upside," said Robert Reffkin, Founder and Chief Executive Officer of Compass.
The stock is up 9.6% since reporting and currently trades at $8.75.
Is now the time to buy Compass? Access our full analysis of the earnings results here, it’s free.
Best Q4: The Real Brokerage (NASDAQ:REAX)
Founded in Toronto, Canada in 2014, The Real Brokerage (NASDAQ:REAX) is a technology-driven real estate brokerage firm combining a tech-centric model with an agent-centric philosophy.
The Real Brokerage reported revenues of $350.6 million, up 93.4% year on year, outperforming analysts’ expectations by 16.8%. The business had an incredible quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The Real Brokerage scored the fastest revenue growth among its peers. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 9% since reporting. It currently trades at $4.51.
Is now the time to buy The Real Brokerage? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Offerpad (NYSE:OPAD)
Known for giving homeowners cash offers within 24 hours, Offerpad (NYSE:OPAD) operates a tech-enabled platform specializing in direct home buying and selling solutions.
Offerpad reported revenues of $174.3 million, down 27.5% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Offerpad delivered the slowest revenue growth in the group. As expected, the stock is down 22.6% since the results and currently trades at $1.68.
Read our full analysis of Offerpad’s results here.
Cushman & Wakefield (NYSE:CWK)
With expertise in the commercial real estate sector, Cushman & Wakefield (NYSE:CWK) is a global Chicago-based real estate firm offering a comprehensive range of services to clients.
Cushman & Wakefield reported revenues of $2.63 billion, up 3% year on year. This result lagged analysts' expectations by 0.9%. Taking a step back, it was a mixed quarter as it also produced a narrow beat of analysts’ EBITDA estimates.
The stock is down 18.9% since reporting and currently trades at $10.56.
Read our full, actionable report on Cushman & Wakefield here, it’s free.
JLL (NYSE:JLL)
Founded in 1999 through the merger of Jones Lang Wootton and LaSalle Partners, JLL (NYSE:JLL) is a company specializing in real estate advisory and investment management services.
JLL reported revenues of $6.81 billion, up 15.8% year on year. This number topped analysts’ expectations by 1.4%. More broadly, it was a mixed quarter as it also logged a decent beat of analysts’ EPS estimates but a miss of analysts’ Capital Markets revenue estimates.
The stock is down 14.6% since reporting and currently trades at $240.55.
Read our full, actionable report on JLL here, it’s free.
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