Spotting Winners: JLL (NYSE:JLL) And Real Estate Services Stocks In Q2
Let’s dig into the relative performance of JLL (NYSE:JLL) and its peers as we unravel the now-completed Q2 real estate services earnings season.
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 mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was 13.1% below.
Stocks--especially those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts. Thankfully, real estate services stocks have been resilient with share prices up 7.1% on average since the latest earnings results.
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 $5.63 billion, up 11.4% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ earnings estimates but a miss of analysts’ Work Dynamics revenue estimates.
"We are pleased with our second quarter results as Work Dynamics led strong resilient revenue growth and our transactional business lines benefited from investments we have made to take advantage of greater commercial real estate activity," said Christian Ulbrich, JLL CEO.
Interestingly, the stock is up 6.4% since reporting and currently trades at $247.19.
Is now the time to buy JLL? Access our full analysis of the earnings results here, it’s free.
Best Q2: 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 $340.8 million, up 83.9% year on year, outperforming analysts’ expectations by 28.9%. It was an incredible quarter for the company with an impressive beat of analysts’ earnings estimates.
The Real Brokerage delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 9.5% since reporting. It currently trades at $5.97.
Is now the time to buy The Real Brokerage? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: 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 $251.1 million, up 9.1% year on year, falling short of analysts’ expectations by 11.4%. It was a weak quarter for the company with revenue guidance for next quarter missing analysts’ expectations.
Offerpad had the weakest performance against analyst estimates in the group. As expected, the stock is down 13.6% since the results and currently trades at $3.37.
Read our full analysis of Offerpad’s results here.
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 $1.70 billion, up 13.8% year on year, surpassing analysts’ expectations by 3.3%. More broadly, it was a mixed quarter for the company with a decent beat of analysts’ operating margin estimates but a miss of analysts’ earnings estimates.
The stock is up 6.3% since reporting and currently trades at $4.69.
Read our full, actionable report on Compass 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 $158.4 million, down 2.8% year on year, falling short of analysts’ expectations by 1.5%. Taking a step back, it was a mixed quarter for the company with a decent beat of analysts’ earnings estimates.
The stock is down 2.3% since reporting and currently trades at $37.58.
Read our full, actionable report on Marcus & Millichap here, it’s free.
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