Newmark Group (NasdaqGS:NMRK) - Share price, News & Analysis

Q: What is the Fair Price of NMRK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

NMRK ($10.7) is trading below our estimate of [[fair value]] ($30.51)

NMRK fundamental analysis
Snowflake Score
Valuation	6/6
Future Growth	2/6
Past Performance	2/6
Financial Health	3/6
Dividends	1/6

NMRK Stock Overview

Newmark Group, Inc. provides commercial real estate services in the United States and internationally.

Rewards

Trading at 64.9% below our estimate of its fair value

Earnings are forecast to grow 15.28% per year

Risk Analysis

Debt is not well covered by operating cash flow

High level of non-cash earnings

Profit margins (10.2%) are lower than last year (24.6%)

Newmark Group Competitors

Marcus & Millichap

NYSE:MMI

US$1.6b

Anywhere Real Estate

NYSE:HOUS

US$1.2b

Cushman & Wakefield

NYSE:CWK

US$3.6b

eXp World Holdings

NasdaqGM:EXPI

US$2.3b

Price History & Performance

Summary of all time highs, changes and price drops for Newmark Group
Historical stock prices
Current Share Price	US$10.70
52 Week High	US$19.10
52 Week Low	US$8.66
Beta	1.78
1 Month Change	8.96%
3 Month Change	-11.72%
1 Year Change	-19.25%
3 Year Change	15.68%
5 Year Change	n/a
Change since IPO	-23.30%

Recent News & Updates

Jul 28

Newmark Group Q2 2022 Earnings Preview

Newmark Group (NASDAQ:NMRK) is scheduled to announce Q2 earnings results on Friday, July 29th, before market open. The consensus EPS Estimate is $0.36 (+16.1% Y/Y) and the consensus Revenue Estimate is $670.04M (+6.4% Y/Y). Over the last 2 years, NMRK has beaten EPS estimates 88% of the time and has beaten revenue estimates 88% of the time. Over the last 3 months, EPS estimates have seen 1 upward revision and 1 downward. Revenue estimates have seen 1 upward revision and 2 downward.

Shareholder Returns

	NMRK	US Real Estate	US Market
7D	-6.1%	0.4%	1.0%
1Y	-19.2%	-38.1%	-12.9%

Return vs Industry: NMRK exceeded the US Real Estate industry which returned -38% over the past year.

Return vs Market: NMRK underperformed the US Market which returned -12.8% over the past year.

Price Volatility

Is NMRK's price volatile compared to industry and market?
NMRK volatility
NMRK Average Weekly Movement	6.4%
Real Estate Industry Average Movement	7.9%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.1%
10% least volatile stocks in US Market	3.2%

Stable Share Price: NMRK is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: NMRK's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1929	6,500	Barry Gosin	https://nmrk.com

Newmark Group, Inc. provides commercial real estate services in the United States and internationally. The company’s investor/owner services and products include capital markets, such as investment, debt and structured finance, and loan sales; agency leasing, property management, and valuation and advisory; and commercial real estate due diligence consulting and advisory services, as well as government sponsored enterprise lending, loan servicing, mortgage broking, and equity-raising services. Its occupier services and products comprise tenant representation; real estate management technology systems; workplace and occupancy strategy; global corporate consulting; project management; account and transaction management; and lease administration and facilities management services.

Newmark Group Fundamentals Summary

How do Newmark Group's earnings and revenue compare to its market cap?
NMRK fundamental statistics
Market Cap	US$2.25b
Earnings (TTM)	US$326.77m
Revenue (TTM)	US$3.21b

6.0x

P/E Ratio

0.6x

P/S Ratio

Is NMRK overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NMRK income statement (TTM)
Revenue	US$3.21b
Cost of Revenue	US$0
Gross Profit	US$3.21b
Other Expenses	US$2.88b
Earnings	US$326.77m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.77
Gross Margin	100.00%
Net Profit Margin	10.19%
Debt/Equity Ratio	89.7%

How did NMRK perform over the long term?

See historical performance and comparison

Dividends

1.1%

Current Dividend Yield

5%

Payout Ratio

Does NMRK pay a reliable dividends?

See NMRK dividend history and benchmarks

When do you need to buy NMRK by to receive an upcoming dividend?
Newmark Group dividend dates
Ex Dividend Date	Aug 12 2022
Dividend Pay Date	Aug 31 2022
Days until Ex dividend	4 days
Days until Dividend pay date	23 days

Does NMRK pay a reliable dividends?

See NMRK dividend history and benchmarks

We’ve recently updated our valuation analysis.

Valuation

Is NMRK undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

6/6

Valuation Score 6/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for NMRK?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for NMRK. This is calculated by dividing NMRK's market cap by their current preferred multiple.
What is NMRK's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$2.25b

NMRK key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.2x
Enterprise Value/EBITDA	5.6x
PEG Ratio	0.4x

Price to Earnings Ratio vs Peers

How does NMRK's PE Ratio compare to its peers?

NMRK PE Ratio vs Peers

The above table shows the PE ratio for NMRK vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	16x
MMI Marcus & Millichap	9.2x	7.4%	US$1.6b
HOUS Anywhere Real Estate	4.6x	-3.4%	US$1.2b
CWK Cushman & Wakefield	10x	2.6%	US$3.6b
EXPI eXp World Holdings	40.3x	42.4%	US$2.3b
NMRK Newmark Group	6x	15.3%	US$2.2b

Price-To-Earnings vs Peers: NMRK is good value based on its Price-To-Earnings Ratio (6x) compared to the peer average (16x).

Price to Earnings Ratio vs Industry

How does NMRK's PE Ratio compare vs other companies in the US Real Estate Industry?

Price-To-Earnings vs Industry: NMRK is good value based on its Price-To-Earnings Ratio (6x) compared to the US Real Estate industry average (10.1x)

Price to Earnings Ratio vs Fair Ratio

What is NMRK's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

NMRK PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	6x
Fair PE Ratio	35.2x

Price-To-Earnings vs Fair Ratio: NMRK is good value based on its Price-To-Earnings Ratio (6x) compared to the estimated Fair Price-To-Earnings Ratio (35.2x).

Share Price vs Fair Value

What is the Fair Price of NMRK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: NMRK ($10.7) is trading below our estimate of fair value ($30.51)

Significantly Below Fair Value: NMRK is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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Future Growth

How is Newmark Group forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

15.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NMRK's forecast earnings growth (15.3% per year) is above the savings rate (1.9%).

Earnings vs Market: NMRK's earnings (15.3% per year) are forecast to grow faster than the US market (12.8% per year).

High Growth Earnings: NMRK's earnings are forecast to grow, but not significantly.

Revenue vs Market: NMRK's revenue (4.1% per year) is forecast to grow slower than the US market (7.9% per year).

High Growth Revenue: NMRK's revenue (4.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if NMRK's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has Newmark Group performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

37.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: NMRK has a high level of non-cash earnings.

Growing Profit Margin: NMRK's current net profit margins (10.2%) are lower than last year (24.6%).

Past Earnings Growth Analysis

Earnings Trend: NMRK's earnings have grown significantly by 37.5% per year over the past 5 years.

Accelerating Growth: NMRK's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NMRK had negative earnings growth (-38.7%) over the past year, making it difficult to compare to the Real Estate industry average (19.7%).

Return on Equity

High ROE: NMRK's Return on Equity (26.7%) is considered high.

Discover strong past performing companies

Financial Health

How is Newmark Group's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NMRK's short term assets ($1.8B) exceed its short term liabilities ($1.7B).

Long Term Liabilities: NMRK's short term assets ($1.8B) exceed its long term liabilities ($1.4B).

Debt to Equity History and Analysis

Debt Level: NMRK's net debt to equity ratio (71.5%) is considered high.

Reducing Debt: NMRK's debt to equity ratio has increased from 85.9% to 89.7% over the past 5 years.

Debt Coverage: NMRK's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: NMRK's interest payments on its debt are well covered by EBIT (16.2x coverage).

Balance Sheet

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Dividend

What is Newmark Group current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

1.12%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: NMRK's dividend (1.12%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.52%).

High Dividend: NMRK's dividend (1.12%) is low compared to the top 25% of dividend payers in the US market (4.09%).

Stability and Growth of Payments

Stable Dividend: NMRK has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: NMRK has only been paying a dividend for 4 years, and since then payments have fallen.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (4.7%), NMRK's dividend payments are thoroughly covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: NMRK is paying a dividend but the company has no free cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

2.4yrs

Average management tenure

CEO

Barry Gosin (71 yo)

43.58yrs

Tenure

US$12,613,061

Compensation

Mr. Barry M. Gosin has been the Chief Executive Officer of Newmark Group, Inc. (formerly known as Newmark Grubb Knight Frank Capital Group) and Newmark Grubb Knight Frank since 1979. He serves as the Chief...

CEO Compensation Analysis

Compensation vs Market: Barry's total compensation ($USD12.61M) is above average for companies of similar size in the US market ($USD5.42M).

Compensation vs Earnings: Barry's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.

Leadership Team

Experienced Management: NMRK's management team is considered experienced (2.4 years average tenure).

Board Members

Experienced Board: NMRK's board of directors are considered experienced (4.4 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: NMRK insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/06 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31