In This Article:
Investors in RE/MAX Holdings, Inc. (NYSE:RMAX) had a good week, as its shares rose 8.7% to close at US$8.11 following the release of its quarterly results. It was a pretty bad result overall; while revenues were in line with expectations at US$74m, statutory losses exploded to US$0.10 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the five analysts covering RE/MAX Holdings provided consensus estimates of US$294.7m revenue in 2025, which would reflect a measurable 3.0% decline over the past 12 months. Statutory earnings per share are expected to tumble 23% to US$0.33 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$299.3m and earnings per share (EPS) of US$0.42 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.
View our latest analysis for RE/MAX Holdings
The consensus price target held steady at US$9.33, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on RE/MAX Holdings, with the most bullish analyst valuing it at US$10.00 and the most bearish at US$9.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.0% by the end of 2025. This indicates a significant reduction from annual growth of 3.2% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 10% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - RE/MAX Holdings is expected to lag the wider industry.