The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Newmark (NASDAQ:NMRK) and the rest of the real estate services stocks fared in Q1.
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 strong Q1. As a group, revenues beat analysts’ consensus estimates by 2% while next quarter’s revenue guidance was 0.9% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Newmark (NASDAQ:NMRK)
Founded in 1929, Newmark (NASDAQ:NMRK) provides commercial real estate services, including leasing advisory, global corporate services, investment sales and capital markets, property and facilities management, valuation and advisory, and consulting.
Newmark reported revenues of $665.5 million, up 21.8% year on year. This print exceeded analysts’ expectations by 8.9%. Overall, it was a strong quarter for the company with EPS guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EPS estimates.
Newmark delivered the weakest full-year guidance update of the whole group. Interestingly, the stock is up 3.1% since reporting and currently trades at $11.39.
Is now the time to buy Newmark? Access our full analysis of the earnings results here, it’s free.
Best Q1: 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 $354 million, up 76.3% year on year, outperforming analysts’ expectations by 6.3%. The business had a stunning quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The Real Brokerage pulled off 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 4.9% since reporting. It currently trades at $4.24.
Is now the time to buy The Real Brokerage? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: eXp World (NASDAQ:EXPI)
Founded in 2009, eXp World (NASDAQ:EXPI) is a real estate company known for its virtual, cloud-based approach to real estate brokerage.
eXp World reported revenues of $954.9 million, up 1.3% year on year, falling short of analysts’ expectations by 4%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
As expected, the stock is down 7.7% since the results and currently trades at $8.
Read our full analysis of eXp World’s results here.
RE/MAX (NYSE:RMAX)
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 $74.47 million, down 4.9% year on year. This number topped analysts’ expectations by 1.3%. More broadly, it was a satisfactory quarter as it also logged an impressive beat of analysts’ EPS estimates but EBITDA guidance for next quarter missing analysts’ expectations.
RE/MAX scored the highest full-year guidance raise among its peers. The stock is down 3.3% since reporting and currently trades at $7.54.
Read our full, actionable report on RE/MAX here, it’s free.
Marcus & Millichap (NYSE:MMI)
Founded in 1971, Marcus & Millichap (NYSE:MMI) specializes in commercial real estate investment sales, financing, research, and advisory services.
Marcus & Millichap reported revenues of $145 million, up 12.3% year on year. This result beat analysts’ expectations by 3.5%. It was a stunning quarter as it also put up an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The stock is flat since reporting and currently trades at $29.20.
Read our full, actionable report on Marcus & Millichap here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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