Real Brokerage Inc (NASDAQ: REAX)

Sector: Real Estate Industry: Real Estate Services CIK: 0001862461
Market Cap 964.87 Mn
P/B 17.99
P/E -91.50
P/S 0.53
ROIC (Qtr) -25.22
Div Yield % 0.00
Rev 1y % (Qtr) 52.64
Total Debt (Qtr) 0.00
Debt/Equity (Qtr) 0.00

About

Price action

Investment thesis

Bull case

  • Operating cash flow of 69.86M provides exceptional 82.09x coverage of interest expenses 851000, showing strong debt service capability.
  • Robust free cash flow of 68.85M exceeds capital expenditure of 1.02M by 67.76x, indicating strong organic growth funding capability.
  • Robust tangible asset base of 131.70M provides 3.98x coverage of working capital 33.09M, indicating strong operational backing.
  • Free cash flow of 68.85M provides exceptional 80.90x coverage of interest expense 851000, showing strong debt service ability.
  • Operating cash flow of 69.86M provides solid 0.76x coverage of current liabilities 91.62M, showing strong operational health.

Bear case

  • Operating cash flow of 69.86M barely covers its investment activities of (15.11M), with a coverage ratio of -4.62, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (15.11M) provide weak support for R&D spending of 16.68M, which is -0.91x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 69.86M shows concerning coverage of stock compensation expenses of 65.53M, with a 1.07 ratio indicating potential earnings quality issues.
  • Operating earnings of (9.61M) show weak coverage of depreciation charges of 1.72M, with a -5.60 ratio indicating high capital intensity and potential reinvestment needs.
  • Retained earnings of (108.65M) provide limited buffer against comprehensive income items of 392000, which is -277.16x, indicating elevated exposure to market risks.

Peer comparison

Companies in the Real Estate Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 CBRE Cbre Group, Inc. 51.14 Bn 41.65 1.30 9.48 Bn
2 CSGP Costar Group, Inc. 26.47 Bn 1,304.00 8.66 1.18 Bn
3 BEKE KE Holdings Inc. 21.08 Bn 43.29 1.45 2.96 Bn
4 JLL Jones Lang Lasalle Inc 16.90 Bn 26.75 0.67 3.48 Bn
5 FSV FirstService Corp 7.01 Bn 56.92 1.78 1.51 Bn
6 COMP Compass, Inc. 6.69 Bn -118.64 1.01 0.48 Bn
7 CIGI Colliers International Group Inc. 5.39 Bn 69.70 2.00 2.50 Bn
8 OPEN Opendoor Technologies Inc. 4.15 Bn -13.09 0.88 1.79 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 5.98 1.34
EV to Cash from Ops. EV/CFO 12.44 2.97
EV to Debt EV to Debt 0.00 6.15
EV to EBIT EV/EBIT -90.47 5.23
EV to EBITDA EV/EBITDA -100.24 18.71
EV to Free Cash Flow [EV/FCF] EV/FCF 12.62 -9.39
EV to Market Cap EV to Market Cap 0.90 4.27
EV to Revenue EV/Rev 0.48 3.62
Price to Book Value [P/B] P/B 17.99 2.10
Price to Earnings [P/E] P/E -91.50 45.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.38
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -6.05
Dividend per Basic Share Div per Share (Qtr) 0.00 0.22
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 0.42
Interest Coverage Int. cover (Qtr) -11.29 -2.22
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 11.34 -12,525.88
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 44.37 23.84
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.27
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 68.28 4.69
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 69.88 26.73
EBIT Growth (1y) % EBIT 1y % (Qtr) 68.55 12.80
EBT Growth (1y) % EBT 1y % (Qtr) 67.18 21.27
EPS Growth (1y) % EPS 1y % (Qtr) 77.78 22.42
FCF Growth (1y) % FCF 1y % (Qtr) 82.91 54.29
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 56.19 39.11
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 12.49 1.45
Cash Payout Ratio Cash Payout (Qtr) 0.00 -0.01
Cash Ratio Cash Ratio (Qtr) 0.79 1.45
Current Ratio Curr Ratio (Qtr) 1.36 2.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 -0.06
Interest Cover Ratio Int Coverage (Qtr) -11.29 -2.22
Times Interest Earned Times Interest Earned (Qtr) -11.29 -2.22
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -0.40 -121.98
EBIT Margin % EBIT Margin % (Qtr) -0.53 -136.76
EBT Margin % EBT Margin % (Qtr) -0.58 -144.54
Gross Margin % Gross Margin % (Qtr) 8.60 32.87
Net Profit Margin % Net Margin % (Qtr) -0.60 -139.89