Let’s dig into the relative performance of JLL (NYSE:JLL) and its peers as we unravel the now-completed Q3 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 13 real estate services stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.2% 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 3.9% 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 $5.87 billion, up 14.8% year on year. This print exceeded analysts’ expectations by 4.4%. Overall, it was a stunning quarter for the company with an impressive beat of analysts’ adjusted operating income estimates and a solid beat of analysts’ EPS estimates.
"JLL achieved strong third-quarter revenue and profit growth fueled by continued high demand for our outsourcing services and an acceleration in transactional activity," said Christian Ulbrich, JLL CEO.
Unsurprisingly, the stock is down 8.7% since reporting and currently trades at $255.48.
Is now the time to buy JLL? Access our full analysis of the earnings results here, it’s free.
Best Q3: 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 $372.5 million, up 73.5% year on year, outperforming analysts’ expectations by 7.4%. 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 scored 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% since reporting. It currently trades at $4.85.
Is now the time to buy The Real Brokerage? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: 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 $208.1 million, down 11.2% year on year, exceeding analysts’ expectations by 1.7%. Still, it was a disappointing quarter as it posted revenue guidance for next quarter missing analysts’ expectations.
Offerpad delivered the slowest revenue growth in the group. Interestingly, the stock is up 4% since the results and currently trades at $3.40.
Read our full analysis of Offerpad’s results here.
CBRE (NYSE:CBRE)
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 print beat analysts’ expectations by 2.7%. It was a very strong quarter as it also put up a solid beat of analysts’ adjusted operating income estimates and a decent beat of analysts’ Investment Management revenue estimates.
The stock is up 7.1% since reporting and currently trades at $131.92.
Read our full, actionable report on CBRE here, it’s free.
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 $1.49 billion, up 11.7% year on year. This print was in line with analysts’ expectations. Overall, it was a very strong quarter as it also produced EBITDA guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EPS estimates.
The stock is up 7.8% since reporting and currently trades at $6.
Read our full, actionable report on Compass here, it’s free.
Market Update
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 has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), 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 the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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