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Compass
(NYSE:COMP)
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Rating:52Neutral
Price Target:
$10.00
▼(-13.42% Downside)
Action:Reiterated
Date:10/14/26
The score is held back primarily by weak profitability, compressed margins, and higher leverage despite strong revenue growth and improved cash flow. A constructive earnings update (record adjusted EBITDA, strong free cash flow, and improving leverage outlook) offsets some of the fundamental risk, while technicals remain bearish and valuation (high P/E with no dividend yield) provides limited downside support.
Positive Factors
Market Outperformance
Compass is gaining share in its core brokerage market, with transaction and gross transaction value growth materially exceeding overall market growth. Sustained outperformance can strengthen agent attraction, improve brand relevance, and support revenue expansion as housing activity develops.
Negative Factors
Weak Profitability
Strong revenue growth has not yet translated into durable accounting profitability, as negative EBIT, EBITDA, and net margin show that costs continue to absorb operating gains. Persistent losses could limit reinvestment capacity and make future earnings more dependent on execution improvements.
Read all positive and negative factors
Positive Factors
Negative Factors
Market Outperformance
Compass is gaining share in its core brokerage market, with transaction and gross transaction value growth materially exceeding overall market growth. Sustained outperformance can strengthen agent attraction, improve brand relevance, and support revenue expansion as housing activity develops.
Read all positive factors
Compass Key Performance Indicators (KPIs)
Any
Total Transactions
Represents overall deal flow handled by Compass in a given period. Strong or improving transaction volumes point to healthy demand and platform adoption, while drops often precede lower revenues and can reflect market seasonality, pricing pressure, or competitive losses.
Represents overall deal flow handled by Compass in a given period. Strong or improving transaction volumes point to healthy demand and platform adoption, while drops often precede lower revenues and can reflect market seasonality, pricing pressure, or competitive losses.
Data provided by:
The Fly
The FlyCompass (COMP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.44B
Dividend YieldN/A
Average Volume (3M)16.47M
Price to Earnings (P/E)90.2
Beta (1Y)1.30
Revenue Growth67.81%
EPS GrowthN/A
CountryUS
Employees3,200
SectorReal Estate
Sector Strength53
IndustryReal Estate - Services
Share Statistics
EPS (TTM)0.11
Shares Outstanding757,522,200
10 Day Avg. Volume14,427,259
30 Day Avg. Volume16,472,768
Financial Highlights & Ratios
PEG Ratio1.56
Price to Book (P/B)7.73
Price to Sales (P/S)0.87
P/FCF Ratio29.74
Enterprise Value/Market Cap1.86
Enterprise Value/Revenue1.31
Enterprise Value/Gross Profit10.31
Enterprise Value/Ebitda128.58
Forecast
1Y Price Target
$14.67Price Target Upside26.98% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
EPS Forecast (FY)0.16
Revenue Forecast (FY)$14.36B
Compass Business Overview & Revenue Model
Company Description
Headquartered in New York, New York, and established in 2012, Compass, Inc. delivers real estate brokerage services throughout the United States. The company's core offering is a sophisticated, cloud-based platform that integrates a comprehensive ...
How the Company Makes Money
Compass generates the vast majority of its revenue from residential real estate brokerage commissions earned when homes are bought or sold through agents affiliated with Compass. In a typical transaction, the seller pays a commission that is share...
Compass Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call presents a strongly positive operating and financial update: record revenue and adjusted EBITDA, meaningful cash generation and rapid progress on cost synergies, strong outperformance versus the housing market (notably in luxury and the Bay Area), accelerating technology and AI adoption, and early benefits from the Rocket-Redfin partnership. Headwinds are manageable and mostly execution/timing-related — lower gross agent adds as the company trades for higher productivity, commission mix pressure (43 bps), a modest increase in full-year OpEx guidance, Q3 guidance that is seasonally lower than Q2, and debt call provisions that limit immediate gross-debt paydown. Overall, the highlights materially outweigh the lowlights given the size of the record metrics, cash flow improvement, and accelerated synergy realization.Positive Updates
Record Revenue and Adjusted EBITDA
Q2 revenue of $4.3 billion, up ~14% year-over-year (pro forma). Record adjusted EBITDA of $363 million (highest second-quarter on record and more than any full year previously).
Negative Updates
Decline in Gross Agent Adds
Gross agent adds fell to 2,816 in Q2 from 3,503 in Q1 (down ~20%), reflecting a deliberate shift toward recruiting more productive agents following the Anywhere acquisition.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Revenue and Adjusted EBITDA
Q2 revenue of $4.3 billion, up ~14% year-over-year (pro forma). Record adjusted EBITDA of $363 million (highest second-quarter on record and more than any full year previously).
Read all positive updates
Company Guidance
Management guided Q3 2026 consolidated revenue of $3.85–$4.05 billion and consolidated adjusted EBITDA of $275–$305 million, with basic weighted‑average shares of 767–769 million and positive free cash flow expected in Q3; full‑year non‑GAAP operating expenses were raised to $2.75–$2.80 billion (an increase of $50 million vs. last quarter, including ~$35 million of OpEx from a July brokerage acquisition). They reiterated a plan to leave gross debt largely unchanged through Q1 2027 because of call protections (no‑call/ call‑premium provisions through April 2027), while building cash (cash of $694 million as of 6/30 and Q2 free cash flow of $180 million) to lower net leverage (net debt $2.45 billion at 6/30; using ~2026 consensus adjusted EBITDA of ~$850 million implies net debt/EBITDA just under 3x and management expects it to move into the 2s by year‑end); they also highlighted $1.8 billion of NOLs (~26% combined tax rate, ~ $470 million potential tax shield) and reiterated scenario outputs (at 4.1M home sales: ~$1.0B adj. EBITDA / $750M unlevered FCF; 4.8M: ~$1.5B / $1.0B; 5.5M: ~$2.0B / $1.5B; 6.0M: ~$2.5B / ~$2.0B).Compass Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
27
Negative
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 10.56B | 6.96B | 5.63B | 4.88B | 6.02B | 6.42B |
| Gross Profit | 1.34B | 738.70M | 994.50M | 878.00M | 1.08B | 1.11B |
| EBITDA | 107.40M | 61.90M | -65.60M | -216.40M | -500.30M | -428.50M |
| Net Income | 66.80M | -58.50M | -154.40M | -321.30M | -601.50M | -494.10M |
Balance Sheet | ||||||
| Total Assets | 8.33B | 1.54B | 1.18B | 1.16B | 1.53B | 1.80B |
| Cash, Cash Equivalents and Short-Term Investments | 694.00M | 199.00M | 223.80M | 166.90M | 361.90M | 618.30M |
| Total Debt | 4.11B | 476.20M | 497.60M | 533.90M | 763.00M | 580.70M |
| Total Liabilities | 5.34B | 752.20M | 765.60M | 728.30M | 1.01B | 953.00M |
| Stockholders Equity | 2.98B | 782.00M | 409.40M | 428.70M | 517.10M | 843.80M |
Cash Flow | ||||||
| Free Cash Flow | 127.80M | 203.30M | 105.80M | -37.10M | -362.40M | -78.70M |
| Operating Cash Flow | 154.80M | 216.70M | 121.50M | -25.90M | -292.30M | -28.60M |
| Investing Cash Flow | -378.20M | -191.30M | -36.60M | -11.70M | -100.10M | -192.50M |
| Financing Cash Flow | 741.10M | -50.20M | -28.00M | -157.40M | 136.00M | 399.30M |
Compass Technical Analysis
Neutral
11.55
Price Trends
10.23
Negative
10.63
Negative
9.99
Negative
Market Momentum
-0.12
Negative
52.10
Neutral
80.89
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COMP, the sentiment is Neutral. The current price of 11.55 is above the 20-day moving average (MA) of 9.26, above the 50-day MA of 10.23, and above the 200-day MA of 9.99, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 52.10 is Neutral, neither overbought nor oversold. The STOCH value of 80.89 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for COMP.
Compass Risk Analysis
Compass disclosed 60 risk factors in its most recent earnings report. Compass reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 2 New Risks
1.
We have integrated, and may continue to integrate in the future, machine learning and AI in certain tools and features available on our platform. Machine learning and AI technology present various operational, compliance and reputational risks and if any such risks were to materialize, our business and results of operations may be adversely affected. Q3, 2023
2.
Ongoing antitrust regulatory and/or private plaintiff litigation activities, including the Antitrust Lawsuits, could result in meaningful industry-wide changes and could have a direct or indirect materially adverse affect on our business, financial condition, and results of operations. Q3, 2023
Compass Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
59 Neutral | $553.21M | -22.82 | -25.78% | ― | 38.44% | -12.22% | |
58 Neutral | $681.84M | -37.88 | -6.78% | 4.90% | 8.07% | 47.74% | |
52 Neutral | $7.44B | 90.22 | 3.63% | ― | 67.81% | ― | |
52 Neutral | $1.87B | -1.02 | -165.15% | ― | -37.19% | -306.34% | |
51 Neutral | $145.42M | 6.15 | 15.69% | 6.66% | -2.75% | ― | |
41 Neutral | $6.29M | -0.23 | -75.90% | ― | 4.33% | 24.93% |
* Real Estate Sector Average
COMP
Compass
9.75
1.69
20.97%
AGNT
eXp World Holdings
4.08
-6.84
-62.63%
FTHM
Fathom Holdings
0.18
-1.53
-89.24%
OPEN
Opendoor Technologies
1.93
-6.23
-76.35%
REAX
Real Brokerage
15.13
-23.77
-61.11%
DOUG
Douglas Elliman Inc.
1.60
-1.17
-42.24%
Compass Corporate Events
Business Operations and StrategyExecutive/Board Changes
Compass reshapes board leadership and adds AI-focused director
Positive
Oct 14, 2026
On October 7, 2026, Compass director Charles E. Phillips Jr. resigned from the Board effective October 9, 2026, stepping down as Lead Independent Director, chair of the Nominating and Corporate Governance Committee, and Audit Committee member. His...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.