Latest news with #AnywhereRealEstate
Yahoo
3 days ago
- Business
- Yahoo
Year in review: Cash-flow positive Compass faces resi headwinds
Could Compass be suffering under the weight of its own expectations? The firm spent much of its first cash-flow positive year buying up competitors and duking it out with major industry players over private listings, generating positive headlines and stock moves for its financial and strategic wins. Compass reported its first-ever cash flow-positive period in the second quarter of 2023. It was an important milestone after a year-long cost-cutting campaign and a first in its life as a public company. It kept positivity in the following quarter, but fell into losses while finishing the year. It returned to cash flow positivity in the first quarter of 2024 and marked a full year in its results announced in May. Compass upped its free cash flow in the first quarter to $19.5 million and narrowed its net losses by $82 million to $51 million — only for its stock to fall 19 percent the following day. While Compass continued to improve many of its key operating metrics, the company's ability to return on its massive investment remains unclear, while CEO Robert Reffkin's continues big swings against Clear Cooperation Policy. Compass put up by far the worst May of its publicly-traded competitors, watching its stock fall to $5.91 from $7.81 to close the month, down 24 percent. Douglas Elliman was the only other brokerage to see its stock price swing double-digit percentage points, but its value went in the other direction. The beleaguered brokerage saw its price jump over 60 percent, from $1.69 to $2.72, on news that it received a merger offer from Anywhere Real Estate. The offer for Elliman — which some have speculated could be a target for Reffkin's firm as well — comes after Compass had added a number of brokerages in the last year, including @properties and Christie's International Real Estate. In March, there were reports that Compass was nearing a deal for Berkshire Hathaway HomeServices, which were later denied by HomeServices executives. After arguably exceeding expectations for most of 2024, Compass opened 2025 with a bit of dud, missing consensus estimates on revenue and earnings per share, according to Yahoo Finance. Analysts responded by moving full-year breakeven projection to 2026 from 2025. 'We took down our forecasts pretty massively,' said Needham analyst Bernie McTernan, noting much of that was related to a weak housing market. But in a critical moment for Compass being able to cut its way to profitability and create a flywheel for agent growth with its recent inventory push, 'I don't think the thesis is shaken,' he added. A Compass spokesperson said that the 'miss relative to consensus was largely driven by volatility that we began to observe in mid-March as the news around tariffs caused a pause in activity.' They added that the reduced analyst forecasts were driven by lower-than-expected overall market growth. The company also suffered a blow on a strategic front when Zillow unveiled an updated listing policy that appeared to target Compass' three-phased marketing strategy, which involves listing homes without publishing them on the MLS. 'It definitely seems like Zillow took one of the legs out from under the stool,' McTernan said. Compass, which has taken in over $2 billion in equity investment and has an earnings multiple more in line with a tech company than a brokerage, also has more pressure to perform like a growth stock. Although Compass managed to hit a profitable second quarter last year, it ended the year with a net loss of over $154 million. The company has splurged on a number of acquisition deals in the past year, which has been a major revenue driver and helped increase its market share to a record 6 percent. For Reffkin, a housing market boom could be the thing that vaults the company into profitability as its gross profit numbers can finally begin to outstrip its operating expenses — but that bull market appears further and further away, raising questions about how Compass will continue to float its losses in the meantime. 'When they're growing revenue, fixed costs are great,' McTernan said. One workaround for the company has been the use of stock-based compensation to incentivize employees and recruit agents, which CFO Kalani Reelitz said he expects to be managed down to $100 million per year. But the company still has over $277 million in unrecognized stock-based compensation, all of which will weigh on the company's long-term trajectory. 'We have a well-defined path to reducing our annual stock-based compensation over the next three years,' a Compass spokesperson said. 'The $277 million is factored into the $100 million target we expect over the long term, so it is not a concern for us.' The company recognized over $30 million of stock-based compensation in the first quarter of last year, down slightly from the year prior. While Reffkin has maintained that he will be aggressive in seeking M&A opportunities, the less costly growth trajectory relies on continued organic agent recruitment. On the earnings call, Reelitz said that he continued to hear that Compass' 'inventory strategy, the depth of inventory [and] the three-phase marketing' have helped in agent recruitment. Last year, Reffkin said that in 2025 Compass would have more off-MLS and make-me-move inventory on than any publicly searchable active market, incentivizing buyers and agents to work with the firm. Halfway through this year, that expectation looks all but shot as Zillow and a number of MLSes have challenged Compass' hegemony play. Earlier this year, Compass sued Seattle-based Northwest MLS for interfering with the company's private exclusive model, claiming at one point the listing service shut off its access to the listing service's data feed until Compass removed all of its private exclusive inventory from the market. At the Compass' annual retreat held in early June, Reffkin confirmed to agents that Zillow would 'say every private listing is banned' if Compass didn't remove references to private exclusive listings from its website. 'Does it feel to anyone that we've been discouraged from our private listings, or is it just me?' Reffkin asked the audience, claiming that listing services have flouted a National Association of Realtors' policy that prohibits listing services from discouraging the use of office exclusives. Last month, the California Regional MLS voted in approval of a NAR amendment that would remove the office exclusive carve-out that currently allows Compass' private exclusives to exist. The conversation shift has put Compass on the defensive for the first time since it began waging its battle for the repeal of the Clear Cooperation Policy. Now the company is simply fighting to maintain what existed one year ago. For Reffkin, the solution remains the same — just keep growing, which is what he told over 1,200 Compass agents at the firm's annual retreat. 'If every one of you doubles your business, if every one of you doubles your listings, we can't be bullied anymore,' he said. 'That is the path.' Compass scored first cash flow positive year in 2024 Compass narrows losses amid surge in deals, mergers This article originally appeared on The Real Deal. Click here to read the full story.
Yahoo
09-06-2025
- Business
- Yahoo
Luxury Real Estate Brokerage Rocked By Scandal Gets Surprise Takeover Offer Worth Twice Its Market Value
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Embattled real estate brokerage Douglas Elliman Inc. (NYSE:DOUG) saw its stock price briefly soar to almost twice its market value on May 27 following news of a takeover offer from rival Anywhere Real Estate (NYSE:HOUS), according to Bloomberg. The merger proposal would value the company at over $4 a share. However, Bloomberg reported that Elliman was unlikely to accept the offer, noting that the offer included selling the company's property management business as part of the deal. The proposed purchase would give Anywhere a sizable foothold in some of Douglas Elliman's key markets, including New York and Miami. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Invest Where It Hurts — And Help Millions Heal: Despite brand recognition and being involved in some of the biggest deals of the last few years, including hedge titan Ken Griffin's $238 million record-breaking penthouse purchase at 220 Central Park South, Douglas Elliman has seen its valuation tumble to $190 million from a peak of over $900 million in December 2021, when it was spun off into standalone company by the Vector Group (NYSE:VGR), Bloomberg reported. The biggest issue Douglas Elliman has faced in recent years is the fallout from lawsuits against former high-profile agents Tal and Oren Alexander. Although the brothers left the firm in 2022 to form their brokerage, Official, multiple allegations of rape and sexual assault saw them charged with sex trafficking by federal prosecutors. Their alleged crimes date back to their tenure at Douglas Elliman. According to a federal indictment handed down on Dec. 11, the brothers had conspired in their alleged sex trafficking since 2009. There were other scandals at the brokerage as well. Former CEO Howard Lorber retired last year after disclosing in an internal inquiry that he was intimate with two brokers, Bloomberg reported. Trending: This Jeff Bezos-backed startup will allow you to . Michael S. Liebowitz, Douglas Elliman's current CEO, has focused on implementing austerity measures, according to Bloomberg, and growing the firm's development marketing business. It has borne fruit, with the company reporting $253 million in revenue in the first quarter, a 26.5% year-over-year increase. 'By focusing on high-impact areas like Development Marketing, we're driving growth and reinforcing our position as the leader in the luxury market – delivering our highest first-quarter revenue since 2022 with significant reductions in operating losses,' Liebowitz said in a statement. 'We are optimistic about our trajectory, and we are committed to staying nimble in our core business. With our strong balance sheet as well as continued investment in the agent experience and new technologies, I am confident that we will continue to build long-term growth and enhance stockholder value.' The company recently launched its new digital platform, which includes Elliman Inspirations, an AI-powered home discovery tool that personalizes property searches and facilitates collaboration between agents and clients. Read Next: With Point, you can , which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Image: Shutterstock This article Luxury Real Estate Brokerage Rocked By Scandal Gets Surprise Takeover Offer Worth Twice Its Market Value originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
23-05-2025
- Business
- Bloomberg
Douglas Elliman Receives Takeover Bid as it Battles Alexander Brothers Fallout
Douglas Elliman Inc., the real estate brokerage battling fallout from lawsuits involving a pair of former star agents, received a merger offer from a competitor this week that would value the business at about double its current share price, according to people with knowledge of the matter. Anywhere Real Estate Inc., formerly known as Realogy, has approached Douglas Elliman with a bid that would value it at more than $4 a share, one of the people said, asking not to be identified as the information isn't public. Douglas Elliman isn't likely to accept the bid at the current level, the person said.
Bloomberg
23-05-2025
- Business
- Bloomberg
Douglas Elliman Gets Takeover Bid Amid Fallout From Probe of Former Star Agents
By and Jennifer Epstein Save Douglas Elliman Inc., the real estate brokerage battling fallout from lawsuits involving a pair of former star agents, received a merger offer from a competitor this week that would value the business at about double its current share price, according to people with knowledge of the matter. Anywhere Real Estate Inc., formerly known as Realogy, has approached Douglas Elliman with a bid that would value it at more than $4 a share, one of the people said, asking not to be identified as the information isn't public. Douglas Elliman isn't likely to accept the bid at the current level, the person said.
Yahoo
15-05-2025
- Business
- Yahoo
Anywhere to Participate in the KBW Virtual Real Estate Finance & Technology Conference
MADISON, N.J., May 15, 2025 /PRNewswire/ -- Anywhere Real Estate Inc. (NYSE: HOUS), a global leader in residential real estate services, today announced that Chief Executive Officer and President Ryan Schneider will participate in the KBW Virtual Real Estate Finance & Technology Conference on Tuesday, May 20, 2025. 'Evolving Resi Markets: A Conversation with Anywhere Real Estate', featuring Ryan Schneider, is scheduled for Tuesday, May 20, 2025 at 12:00 p.m. EST. The remarks will be webcast, with access instructions available at under "Investors." The webcast will be archived on the site for 90 days. About Anywhere Real Estate Inc. Anywhere Real Estate Inc. (NYSE: HOUS) is moving real estate to what's next. We fulfill our purpose to empower everyone's next move through our leading integrated services, which include franchise, brokerage, relocation, and title and settlement businesses, as well as mortgage and title insurance underwriter minority owned joint ventures. Our brands are some of the most recognized names in real estate: Better Homes and Gardens® Real Estate, CENTURY 21®, Coldwell Banker®, Coldwell Banker Commercial®, Corcoran®, ERA®, and Sotheby's International Realty®. Every day, we help fuel the productivity of our vast network of franchise owners and our more than 300,000 affiliated agents globally as they build stronger businesses and best serve today's consumers. Learn more about our award-winning culture of innovation and integrity at Investor Contacts: Media Contacts: Alicia Swift Gabriella Chiera (973) 407-4669 (973) 407-5236 John Carr Kyle Kirkpatrick (973) 407-2612 (973) 407-2935 View original content to download multimedia: SOURCE Anywhere Real Estate Inc.
