William Blair analyst Jeff Schmitt has maintained their bullish stance on FTDR stock, giving a Buy rating on February 14.
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Jeff Schmitt has given his Buy rating due to a combination of factors including Frontdoor’s impressive performance in the fourth quarter. The company reported an adjusted EPS of $0.27, significantly surpassing both the firm’s estimate of $0.18 and the consensus of $0.11. This strong performance was driven by a gross margin of 48.6%, which exceeded expectations, supported by new pricing strategies, lower incidence rates, and ongoing process improvements.
Additionally, Frontdoor’s revenue growth of 5% to $383 million outpaced the consensus estimate of $367 million. Despite challenges in the housing market, renewal revenue increased by 4%, and real estate revenue declined by only 3%, better than the anticipated 10% drop. The company’s direct revenues also performed better than expected, decreasing by 16% instead of the projected 20%, thanks to effective promotional activities. These elements contributed to a 32% increase in adjusted EPS for the quarter, reinforcing Schmitt’s positive outlook on the stock.
According to TipRanks, Schmitt is ranked #2949 out of 9385 analysts.