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A Look at Realogy’s Newly Added Risk Factors
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A Look at Realogy’s Newly Added Risk Factors

Realogy (RLGY) is an American real estate services company. Its brands include CENTURY 21, Coldwell Banker, Sotheby’s International Realty, and Better Homes and Gardens.

Let’s take a look at the company’s latest financial performance and new risk factors. (See Realogy stock charts on TipRanks).

Realogy’s Q2 Financial Results

Revenue increased 81% year-over-year to $2.3 billion and surpassed the consensus estimate of $2.05 billion. The company posted EPS of $1.28, which beat consensus estimates of $1.06 and compared favorably to a loss per share of $0.12 in the same quarter last year.

The company finished the quarter with $859 million in cash and $2.6 billion in debt. It managed to reduce its debt in the quarter. Realogy CEO Ryan Schneider said the company ended Q2 with the strongest balance sheet ever, citing a net debt leverage ratio of 2.5x.

Realogy’s Risk Factors

The new TipRanks Risk Factors tool shows 60 risk factors for Realogy. Since Q4 2020, the company has updated its risk profile with two new risk factors.

Realogy tells investors it has entered into warrant and exchangeable note hedge transactions with some counterparties. It cautions that those transactions could have a dilutive effect on its stock price.

The company further says that its arrangement with the counterparties in the note and warrant hedge transactions is not secured by collateral. It cautions that if a counterparty is hit by insolvency proceedings, it would become an unsecured creditor. Realogy also warns that a default by a counterparty may expose it to adverse tax consequences.

The majority of Realogy’s risk factors fall under the Finance and Corporate category, with 38% of the total risks. That is below the sector average of 58%. Realogy’s stock has gained about 27% since the beginning of 2021.

Analysts’ Take on Realogy

KBW analyst Bose George recently upgraded Realogy stock to a Buy from a Hold with a price target of $28. George’s price target suggests 68.07% upside potential.

Consensus among analysts is a Strong Buy based on 3 Buys and 1 Hold. The average Realogy price target of $24 implies 44.06% upside potential to current levels.

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