Dj Lutnick's Former Firm Is Having Its Best Year Ever

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how CBRE and the rest of the real estate services stocks fared in Q3.

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 12 real estate services stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.3% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady as they are up 4.6% on average since the latest earnings results.

CBRE

Established in 1906, CBRE is one of the largest commercial real estate services firms in the world.

CBRE reported revenues of $10.26 billion, up 13.5% year on year. This print exceeded analysts’ expectations by 2.1%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ adjusted operating income and EPS estimates.

Unsurprisingly, the stock is down 3.5% since reporting and currently trades at $158.04.

Is now the time to buy CBRE? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: The Real Brokerage

Founded in Toronto, Canada in 2014, The Real Brokerage is a technology-driven real estate brokerage firm combining a tech-centric model with an agent-centric philosophy.

The Real Brokerage reported revenues of $568.5 million, up 52.6% year on year, outperforming analysts’ expectations by 6.5%. The business had a stunning quarter with EPS in line with analysts’ estimates and a solid beat of analysts’ EBITDA estimates.

The Real Brokerage pulled off the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 10.2% since reporting. It currently trades at $3.94.

Is now the time to buy The Real Brokerage? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Offerpad

Known for giving homeowners cash offers within 24 hours, Offerpad operates a tech-enabled platform specializing in direct home buying and selling solutions.

Offerpad reported revenues of $132.7 million, down 36.2% year on year, falling short of analysts’ expectations by 5.1%. It was a disappointing quarter as it posted a miss of analysts’ homes purchased estimates.

Offerpad delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 18.6% since the results and currently trades at $1.89.

Read our full analysis of Offerpad’s results here.

RE/MAX

Short for Real Estate Maximums, RE/MAX operates a real estate franchise network spanning over 100 countries and territories.

RE/MAX reported revenues of $73.25 million, down 6.7% year on year. This number came in 0.7% below analysts' expectations. Taking a step back, it was a mixed quarter as it also produced an impressive beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ revenue estimates.

The stock is down 2% since reporting and currently trades at $8.11.

Read our full, actionable report on RE/MAX here, it’s free for active Edge members.

Newmark

Founded in 1929, Newmark provides commercial real estate services, including leasing advisory, global corporate services, investment sales and capital markets, property and facilities management, valuation and advisory, and consulting.

Newmark reported revenues of $863.5 million, up 25.9% year on year. This result surpassed analysts’ expectations by 11.8%. Zooming out, it was a mixed quarter as it also recorded a solid beat of analysts’ revenue estimates but a significant miss of analysts’ adjusted operating income estimates.

Newmark pulled off the biggest analyst estimates beat among its peers. The stock is down 10.5% since reporting and currently trades at $16.67.

Read our full, actionable report on Newmark here, it’s free for active Edge members.

Let’s dig into the relative performance of Lazard and its peers as we unravel the now-completed Q3 investment banking & brokerage earnings season.

Investment banks and brokerages facilitate capital raises, mergers and acquisitions, and securities trading. The sector benefits from corporate activity during economic expansion, increased retail trading participation, and advisory opportunities in emerging sectors. Headwinds include economic cycle vulnerability affecting deal flow, compressed trading commissions due to electronic platforms, and regulatory capital requirements constraining certain higher-risk activities.

The 16 investment banking & brokerage stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 4.2% while next quarter’s revenue guidance was in line.

While some investment banking & brokerage stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4% since the latest earnings results.

Lazard

Tracing its roots back to 1848 when it began as a dry goods merchant in New Orleans, Lazard is a global financial advisory and asset management firm that provides strategic advice to corporations, governments, institutions, and wealthy individuals.

Lazard reported revenues of $724.7 million, up 12.2% year on year. This print exceeded analysts’ expectations by 1.5%. Overall, it was a very strong quarter for the company with a beat of analysts’ EPS and AUM estimates.

Unsurprisingly, the stock is down 1.9% since reporting and currently trades at $48.81.

Is now the time to buy Lazard? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: PJT

Spun off from Blackstone in 2015 and founded by former Morgan Stanley executive Paul J. Taubman, PJT Partners is an advisory-focused investment bank that provides strategic advice, restructuring services, and fundraising solutions to corporations, boards, and investment firms.

PJT reported revenues of $447.1 million, up 37% year on year, outperforming analysts’ expectations by 15.6%. The business had an incredible quarter with a beat of analysts’ EPS and revenue estimates.

PJT achieved the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 1.6% since reporting. It currently trades at $165.05.

Is now the time to buy PJT? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Perella Weinberg

Founded in 2006 by veteran investment bankers Joseph Perella and Peter Weinberg during a wave of boutique advisory firm launches, Perella Weinberg Partners is a global independent advisory firm that provides strategic and financial advice to corporations, financial sponsors, and government institutions.

Perella Weinberg reported revenues of $164.6 million, down 40.8% year on year, falling short of analysts’ expectations by 8.4%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue and EPS estimates.

Perella Weinberg delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 6.9% since the results and currently trades at $17.55.

Read our full analysis of Perella Weinberg’s results here.

BGC

Tracing its roots back to 1945 and named after founder Bernard Gerald Cantor, BGC Group operates a global brokerage and financial technology platform that facilitates trading across fixed income, foreign exchange, equities, energy, and commodities markets.

BGC reported revenues of $703 million, up 31.2% year on year. This number came in 4.5% below analysts' expectations. It was a slower quarter as it also logged a significant miss of analysts’ EBITDA and revenue estimates.

The stock is down 6.5% since reporting and currently trades at $8.53.

Read our full, actionable report on BGC here, it’s free for active Edge members.

Charles Schwab

Founded in 1971 as a disruptive force challenging Wall Street's high fees and limited access, Charles Schwab is a wealth management and brokerage firm that provides investment services, banking, and financial advice to individual investors and independent advisors.

Charles Schwab reported revenues of $6.14 billion, up 26.6% year on year. This result surpassed analysts’ expectations by 2.2%. It was a strong quarter as it also produced an impressive beat of analysts’ EBITDA estimates and a decent beat of analysts’ revenue estimates.

The stock is down 4.2% since reporting and currently trades at $90.36.

Read our full, actionable report on Charles Schwab here, it’s free for active Edge members.