Real Estate Services Stocks Q4 Recap: Benchmarking JLL (NYSE:JLL)
As the Q4 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the real estate services industry, including JLL (NYSE:JLL) 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 20.4% since the latest earnings results.
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 print exceeded analysts’ expectations by 1.4%. Despite the top-line beat, it was still a mixed quarter for the company with a decent beat of analysts’ EPS estimates but a miss of analysts’ Capital Markets revenue estimates.
“JLL delivered strong fourth-quarter and full-year 2024 financial results, led by an acceleration in transactional activity and sustained growth in resilient revenues. Throughout 2024, our focus on operating efficiency helped drive significant margin expansion and free cash flow generation,” said Christian Ulbrich, JLL CEO.
JLL Total Revenue
The stock is down 24.7% since reporting and currently trades at $212.
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 Total Revenue
The Real Brokerage achieved the fastest revenue growth among its peers. The stock is down 10.8% since reporting. It currently trades at $4.42.
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 35.9% since the results and currently trades at $1.39.
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 result beat analysts’ expectations by 3.4%. Overall, it was a strong quarter as it also logged EBITDA guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EPS estimates.
The stock is down 6% since reporting and currently trades at $7.50.
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 $244.3 million, up 12% year on year. This number surpassed analysts’ expectations by 0.7%. Zooming out, it was a mixed quarter as it also recorded an impressive beat of analysts’ EPS estimates but a significant miss of analysts’ EBITDA estimates.
The stock is up 7.6% since reporting and currently trades at $8.22.
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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