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Marcus & Millichap Inc (MMI)
NYSE:MMI
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Marcus & Millichap
(NYSE:MMI)
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Rating:55Neutral
Price Target:
$33.00
▲(14.58% Upside)
Marcus & Millichap's overall stock score reflects a challenging financial performance with negative profitability metrics, despite a strong balance sheet. Technical indicators suggest stability, but valuation concerns persist due to a negative P/E ratio. The earnings call provided some optimism with revenue growth, yet profitability pressures remain a significant concern.
Positive Factors
Revenue Growth
Sustained revenue growth indicates strong demand for services and successful market penetration, supporting long-term business expansion.
Financing Revenue Surge
The surge in financing revenue reflects enhanced service offerings and a favorable lending environment, boosting profitability prospects.
Strong Capital Position
A strong capital position with no debt provides financial flexibility for strategic investments and resilience against market fluctuations.
Negative Factors
Profitability Pressure
Continued profitability pressure from cost controls and investments may hinder short-term financial performance and strain resources.
Net Loss
A net loss indicates ongoing operational challenges and may affect investor confidence and capital allocation strategies.
Decline in Larger Transactions
A decline in larger transactions could signal challenges in high-value segments, impacting overall revenue and growth potential.
Marcus & Millichap (MMI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.07B
Dividend Yield1.74%
Average Volume (3M)124.46K
Price to Earnings (P/E)―
Beta (1Y)0.99
Revenue Growth17.89%
EPS Growth65.32%
CountryUS
Employees897
SectorReal Estate
Sector Strength53
IndustryReal Estate - Services
Share Statistics
EPS (TTM)-0.28
Shares Outstanding38,996,975
10 Day Avg. Volume143,165
30 Day Avg. Volume124,464
Financial Highlights & Ratios
PEG Ratio1.88
Price to Book (P/B)2.35
Price to Sales (P/S)2.13
P/FCF Ratio106.92
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue1.46
Enterprise Value/Gross Profit3.85
Enterprise Value/Ebitda257.19
Forecast
1Y Price Target
$33.00Price Target Upside14.58% Upside
Rating ConsensusHold
Number of Analyst Covering2
Marcus & Millichap Business Overview & Revenue Model
Company DescriptionMarcus & Millichap, Inc., an investment brokerage company, provides real estate investment brokerage and financing services to sellers and buyers of commercial real estate in the United States and Canada. The company offers commercial real estate investment sales, financing, research, and advisory services for multifamily, retail, office, industrial, single-tenant net lease, seniors housing, self-storage, hospitality, medical office, and manufactured housing. It also operates as a financial intermediary that provides commercial real estate capital markets solutions, including senior debt, mezzanine debt, joint venture, and preferred equity, as well as loan sales and consultative/due diligence services to commercial real estate owners, developers, investors, and capital providers. In addition, the company provides various ancillary services, including research, advisory, and consulting services to developers, lenders, owners, real estate investment trusts, high net worth individuals, pension fund advisors, and other institutions. Marcus & Millichap, Inc. was founded in 1971 and is headquartered in Calabasas, California.
How the Company Makes MoneyMarcus & Millichap generates revenue primarily through brokerage commissions earned from the sale of commercial properties. When transactions are completed, the company receives a percentage of the sale price as its commission, which is typically shared between the brokerage and the agents involved. Additionally, MMI earns income through financing services, where it assists clients in obtaining loans and mortgages for property acquisitions, receiving fees for these services. The company's significant partnerships with various financial institutions and real estate investment firms also enhance its revenue streams by providing access to a broader range of financing options and investment opportunities for clients. Moreover, the firm's robust research and advisory services contribute to its earnings by offering clients valuable insights and strategic advice, further establishing MMI as a trusted advisor in the commercial real estate space.
Marcus & Millichap Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 31, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with significant revenue growth and impressive performance in financing and private client brokerage segments. However, challenges such as a decline in larger transactions, net loss, and tax expense impact weighed on profitability. The company remains optimistic about future growth and has a strong capital position to support strategic initiatives.Q2-2025 Updates
Positive Updates
Revenue Growth
Total revenue for the second quarter was $172 million, representing approximately 9% growth year-over-year.
Financing Revenue Surge
Financing revenue posted an impressive 44% gain over the second quarter of 2024, driven by contributions from recent additions to the IPA Capital Markets team and improvements in the lending environment.
Private Client Brokerage Growth
The company's private client brokerage business reflected revenue and transaction growth of 10.3% and 12%, respectively.
Auction Division Success
Marcus & Millichap's auction division sold 273 transactions over the past 12 months, accounting for 27% of all commercially auctioned assets in the U.S.
Strong Capital Position
The company is well-capitalized with no debt and $333 million in cash, cash equivalents, and marketable securities.
Negative Updates
Decline in Larger Transactions
Revenue from larger transactions valued at $20 million and above declined by nearly 12% for the quarter.
Profitability Pressure
Adjusted EBITDA for the quarter was $1.5 million, with ongoing pressure from cost controls and strategic investments.
Net Loss
The company reported a net loss of $11 million for the quarter, or $0.28 per share, compared to a net loss of $5.5 million or $0.14 per share for the prior year.
Tax Expense Impact
A change in tax methodology resulted in an outsized tax expense of $7.3 million for the quarter.
Company Guidance
During the Marcus & Millichap Second Quarter 2025 Earnings Conference Call, CEO Hessam Nadji highlighted several key metrics illustrating the company's performance and strategic direction. Total revenue for the quarter reached $172 million, marking a 9% year-over-year growth, with notable contributions from brokerage and financing segments. Brokerage revenue increased by 4%, while financing revenue saw a significant 44% rise, driven by the newly integrated services and improved lending environment. The private client brokerage business experienced a revenue and transaction growth of 10.3% and 12%, respectively, attributed to enhanced client outreach and realistic asset valuations. However, revenue from larger transactions above $20 million decreased by 12%, impacted by tariff-related pauses. The company's strategic focus remains on long-term growth, with adjusted EBITDA reported at $1.5 million amidst ongoing investments in talent, technology, and client services, supported by a robust balance sheet featuring $333 million in cash and marketable securities.Marcus & Millichap Financial Statement Overview
Summary
Marcus & Millichap faces profitability challenges with negative margins and declining returns on equity. While the balance sheet remains strong with low leverage, the company needs to address its operational inefficiencies to improve profitability. Cash flow improvements are a positive sign, but historical volatility suggests caution.Income Statement
Marcus & Millichap's income statement shows a challenging period with declining profitability. The TTM data indicates a negative net profit margin of -1.69% and an EBIT margin of -3.04%, reflecting operational difficulties. Revenue growth is modest at 1.95% TTM, but the company has faced significant revenue declines in previous years. The gross profit margin remains relatively stable, suggesting some resilience in cost management.45
Neutral
Balance Sheet
The balance sheet reveals a stable financial structure with a low debt-to-equity ratio of 0.14 TTM, indicating conservative leverage. However, the return on equity is negative at -1.99% TTM, highlighting profitability challenges. The equity ratio remains strong, suggesting a solid capital base, but the company needs to improve its return metrics to enhance shareholder value.60
Neutral
Cash Flow
Cash flow analysis shows significant improvement in free cash flow growth at 418.70% TTM, indicating better cash generation capabilities. The operating cash flow to net income ratio is 0.83 TTM, suggesting decent cash conversion efficiency. However, the company has experienced volatility in cash flows over the years, which poses a risk to financial stability.55
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 725.90M | 696.06M | 645.93M | 1.30B | 1.30B | 716.91M |
| Gross Profit | 274.42M | 264.59M | 239.28M | 450.82M | 456.23M | 269.03M |
| EBITDA | 4.11M | 4.37M | -25.89M | 156.14M | 205.60M | 71.16M |
| Net Income | -12.29M | -12.36M | -34.03M | 104.22M | 142.47M | 42.84M |
Balance Sheet | ||||||
| Total Assets | 792.21M | 869.80M | 878.41M | 1.00B | 1.05B | 779.12M |
| Cash, Cash Equivalents and Short-Term Investments | 222.41M | 349.46M | 349.13M | 489.29M | 566.01M | 401.41M |
| Total Debt | 82.42M | 84.22M | 87.74M | 82.09M | 77.31M | 78.60M |
| Total Liabilities | 184.43M | 238.98M | 233.14M | 290.20M | 348.89M | 232.29M |
| Stockholders Equity | 607.77M | 630.82M | 645.27M | 713.51M | 696.30M | 546.84M |
Cash Flow | ||||||
| Free Cash Flow | 68.31M | 13.84M | -81.80M | 1.96M | 249.05M | 31.14M |
| Operating Cash Flow | 71.88M | 21.71M | -72.43M | 13.63M | 255.90M | 38.09M |
| Investing Cash Flow | -78.75M | -9.90M | 74.87M | -53.98M | -108.36M | -17.23M |
| Financing Cash Flow | -37.38M | -28.75M | -67.68M | -105.56M | -5.92M | -10.33M |
Marcus & Millichap Technical Analysis
Negative
28.80
Price Trends
30.65
Negative
30.54
Negative
32.40
Negative
Market Momentum
-0.86
Positive
42.13
Neutral
41.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMI, the sentiment is Negative. The current price of 28.8 is below the 20-day moving average (MA) of 29.48, below the 50-day MA of 30.65, and below the 200-day MA of 32.40, indicating a bearish trend. The MACD of -0.86 indicates Positive momentum. The RSI at 42.13 is Neutral, neither overbought nor oversold. The STOCH value of 41.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MMI.
Marcus & Millichap Risk Analysis
Marcus & Millichap disclosed 45 risk factors in its most recent earnings report. Marcus & Millichap 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 0 New Risks
Marcus & Millichap Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $13.76B | 25.33 | 8.40% | ― | 13.47% | 47.52% | |
73 Outperform | $3.38B | 17.08 | 11.62% | ― | 4.63% | 887.64% | |
68 Neutral | $45.50B | 43.25 | 13.13% | ― | 14.96% | 19.11% | |
66 Neutral | $3.00B | 39.84 | 6.00% | 0.67% | 16.29% | 69.89% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
55 Neutral | $1.07B | ― | -1.99% | 1.74% | 17.89% | 65.32% | |
46 Neutral | $1.03B | ― | -2.97% | 6.31% | -4.15% | 75.18% |
* Real Estate Sector Average
MMI
Marcus & Millichap
28.80
-8.67
-23.14%
CBRE
CBRE Group
154.36
29.99
24.11%
JLL
Jones Lang Lasalle
294.73
27.49
10.29%
KW
Kennedy-Wilson
7.61
-2.97
-28.07%
NMRK
Newmark Group
17.92
2.95
19.71%
CWK
Cushman & Wakefield
15.55
2.45
18.70%
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.