Q3 Rundown: Redfin (NASDAQ:RDFN) Vs Other Real Estate Services Stocks
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how real estate services stocks fared in Q3, starting with Redfin (NASDAQ:RDFN).
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 14 real estate services stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was 7.8% below.
While some real estate services stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.6% since the latest earnings results.
Redfin (NASDAQ:RDFN)
Founded by a former medical school student, electrical engineer, and Amazon data engineer, Redfin (NASDAQ:RDFN) is a real estate company offering brokerage services through an online platform.
Redfin reported revenues of $278 million, up 3.4% year on year. This print fell short of analysts’ expectations by 1%. Overall, it was a weak quarter for the company with a significant miss of analysts’ EBITDA estimates.
“Redfin’s third-quarter results were within our guidance range, and we’re now forecasting fourth-quarter growth in market share and revenues,” said Redfin CEO Glenn Kelman.
Redfin Total Revenue
Unsurprisingly, the stock is down 30.3% since reporting and currently trades at $7.99.
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 $372.5 million, up 73.5% year on year, outperforming analysts’ expectations by 7.4%. The business had an incredible quarter with an impressive beat of analysts’ EPS and EBITDA estimates.
The Real Brokerage Total Revenue
The Real Brokerage achieved the fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 14.4% since reporting. It currently trades at $4.83.
Formerly known as Realogy Holdings, Anywhere Real Estate (NYSE:HOUS) is a residential real estate company with a network of brokerages, franchises, and settlement services.
Anywhere Real Estate reported revenues of $1.54 billion, down 3.1% year on year, falling short of analysts’ expectations by 5.7%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Anywhere Real Estate delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 3.5% since the results and currently trades at $4.14.
Established in 1906, CBRE (NYSE:CBRE) is one of the largest commercial real estate services firms in the world.
CBRE reported revenues of $9.04 billion, up 14.8% year on year. This number surpassed analysts’ expectations by 2.7%. Overall, it was a very strong quarter as it also recorded an impressive beat of analysts’ adjusted operating income estimates and a decent beat of analysts’ Investment Management revenue estimates.
The stock is up 6.9% since reporting and currently trades at $131.61.
Short for Real Estate Maximums, RE/MAX (NYSE:RMAX) operates a real estate franchise network spanning over 100 countries and territories.
RE/MAX reported revenues of $78.48 million, down 3.4% year on year. This print was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also logged a solid beat of analysts’ adjusted operating income estimates but EBITDA guidance for next quarter missing analysts’ expectations.
RE/MAX had the weakest full-year guidance update among its peers. The stock is down 10.5% since reporting and currently trades at $10.96.
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