Overview

• US real estate franchisor's Q1 revenue fell 5.7% yr/yr

• Adjusted EPS for Q1 missed consensus, with adjusted EBITDA also below estimates

• Company previously entered merger agreement to be acquired by The Real Brokerage, deal expected to close H2 2026

Outlook

• Company does not intend to provide quarterly or annual guidance while merger is pending

Result Drivers

• FEE MODEL CHANGES AND AGENT COUNT - Revenue and adjusted EBITDA declined mainly due to modifications to standard fee models and a decrease in U.S. agent count

• HIGHER OPERATING EXPENSES - Operating expenses rose due to settlement charges, increased selling, operating and administrative expenses, and merger transaction costs

• DECLINE IN RECURRING REVENUE - Recurring revenue streams, including franchise fees and annual dues, decreased 10.2% yr/yr and made up a smaller share of total revenue

Company press release: ID:nPn9BgL3qa

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q1 Revenue	Miss	$70.20 mln	$72.46 mln (2 Analysts)
Q1 Adjusted EPS	Miss	$0.16	$0.22 (3 Analysts)
Q1 EPS		-$0.48
Q1 Net Income		-$9.70 mln
Q1 Adjusted EBITDA	Miss	$15.60 mln	$18.73 mln (3 Analysts)
Q1 Adjusted EBITDA Margin		22.20%

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the real estate services peer group is "buy"

• Wall Street's median 12-month price target for Re/Max Holdings Inc is $13.80, about 24.8% above its May 7 closing price of $11.06

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 6 three months ago

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