Compass initiated with a Hold at Deutsche Bank

Deutsche Bank initiated coverage of Compass with a Hold rating and $2.70 price target. The analyst sees Compass as a differentiated residential real estate brokerage company that provides value to its agents through an assortment of custom built, integrated software solutions across the buying and selling transaction process. However, Compass is most directly exposed to the current broker commission structure, and as such, regulatory risk could serve as an overhang to the valuation multiple investors are willing to ascribe to shares pending more clarity on the future of brokerage commission fees, the analyst tells investors in a research note.