US$9.00: That's What Analysts Think RE/MAX Holdings, Inc. (NYSE:RMAX) Is Worth After Its Latest Results

Investors in RE/MAX Holdings, Inc. (NYSE:RMAX) had a good week, as its shares rose 9.2% to close at US$7.71 following the release of its quarterly results. It was a pretty bad result overall; while revenues were in line with expectations at US$78m, statutory losses exploded to US$0.18 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on RE/MAX Holdings after the latest results.

View our latest analysis for RE/MAX Holdings

Taking into account the latest results, the seven analysts covering RE/MAX Holdings provided consensus estimates of US$309.3m revenue in 2024, which would reflect a discernible 2.9% decline over the past 12 months. Earnings are expected to improve, with RE/MAX Holdings forecast to report a statutory profit of US$0.13 per share. Before this earnings report, the analysts had been forecasting revenues of US$310.4m and earnings per share (EPS) of US$0.31 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.

The average price target fell 12% to US$9.00, with reduced earnings forecasts clearly tied to a lower valuation estimate. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on RE/MAX Holdings, with the most bullish analyst valuing it at US$10.00 and the most bearish at US$7.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 3.9% annualised decline to the end of 2024. That is a notable change from historical growth of 7.2% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 11% annually for the foreseeable future. It's pretty clear that RE/MAX Holdings' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that RE/MAX Holdings' revenue is expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for RE/MAX Holdings going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 4 warning signs for RE/MAX Holdings you should be aware of, and 2 of them are significant.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.