Compass (COMP) AI Stock Analysis

• Market Cap: $3.34B
• Dividend Yield: N/A
• Average Volume (3M): 7.69M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.65
• Revenue Growth: 19.05%
• EPS Growth: 78.91%
• Country: US
• Employees: 2,566
• Sector: Real Estate
• Sector Strength: 60
• Industry: Software - Application
• EPS (TTM): -0.09
• Shares Outstanding: 521,246,340
• 10 Day Avg. Volume: 5,991,166
• 30 Day Avg. Volume: 7,687,822
• PEG Ratio: -0.92
• Price to Book (P/B): 7.80
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 30.04
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 0.16
• Enterprise Value/Gross Profit: 4.88
• Enterprise Value/Ebitda: -6.63
• 1Y Price Target: $9.67
• Price Target Upside: 56.98% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 49 Neutral
• Price Target: $6.00 ▼(-2.60%Downside)

Significant revenue growth and strategic improvements in cash flow are overshadowed by persistent profitability challenges and technical analysis indicating bearish trends. Valuation concerns further weigh down the overall score.

Positive Factors

Financial Performance

COMP provided preliminary results above their previous outlook, with revenue better than +8% at the midpoint, and adj. EBITDA up by 230% at the midpoint.

Market Share

COMP continues to believe they can reach 30% market share in their top 30 markets, driven by M&A and organic growth.

Revenue Growth

Forecast >20% revenue growth helped by M&A and continued share gains.

Negative Factors

Housing Market

Trimmed housing market forecast now expecting a flat market in '25E vs +5% growth prior.

Market Sentiment

The stock isn't reflecting the benefits of the recently-closed Christie's acquisition or the ability to drive organic market share gains.

Price Target

Lowering PT to $11 following 1Q results, pushing '25E adj. EBITDA estimates lower by -15%.

Compass Business Overview & Revenue Model

Company Description

Compass, Inc. provides real estate brokerage services in the United States. It operates a cloud-based platform that provides an integrated suite of software for customer relationship management, marketing, client service, operations, and other functionality, as well as brokerage and adjacent services in the real estate industry. The company offers mobile apps that allow agents to manage their business anywhere as well as designs consumer-grade interfaces, an automated workflows for agent-client interactions. The company was formerly known as Urban Compass, Inc. and changed its name to Compass, Inc. in January 2021.Compass, Inc. was founded in 2012 and is headquartered in New York, New York.

How the Company Makes Money

Compass makes money primarily through commission fees earned from real estate transactions. As a brokerage, the company employs or partners with real estate agents who facilitate property sales and rentals. Upon the successful completion of a transaction, Compass receives a percentage of the total sale or rental price as a commission. This commission is typically shared between Compass and the agent involved, based on pre-agreed terms. Additionally, Compass may generate revenue through ancillary services, such as mortgage and title services, which complement their core brokerage operations. The company's investment in technology aims to enhance agent productivity and attract top-performing agents, thereby increasing transaction volume and associated revenue. Significant partnerships with real estate professionals and technology providers further bolster Compass's market presence and revenue generation capabilities.

Compass Financial Statement Overview

Summary

Compass shows signs of financial recovery with improved revenue and positive cash flow in 2024. Despite these improvements, persistent net losses, high leverage, and a declining equity base indicate underlying financial challenges. Continued focus on profitability and balance sheet strengthening is necessary for long-term stability.

Income Statement

Compass has shown a fluctuating revenue trend with a recent increase of 15.23% from 2023 to 2024, indicating potential recovery. However, persistent negative net income and EBIT margins highlight ongoing profitability challenges. The gross profit margin improved to 17.67% in 2024, suggesting better cost management but still insufficient to cover operating expenses as reflected in the negative EBIT margin of -2.75%.

Balance Sheet

The company's balance sheet shows moderate leverage with a debt-to-equity ratio of 1.16. Stockholders' equity has declined over recent years, raising concerns about financial stability. The equity ratio of 34.75% indicates a heavy reliance on liabilities, while the negative return on equity underscores inefficiencies in generating profits from equity investments.

Cash Flow

Cash flow has improved, with positive free cash flow of $105.8 million in 2024, a significant turnaround from negative figures in previous years. The operating cash flow to net income ratio is positive at 0.79, showing better conversion of income to cash. However, inconsistent cash flows in prior years pose ongoing concerns.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.63B	4.88B	6.02B	6.42B	3.72B
	Gross Profit
994.50M	553.00M	1.08B	1.11B	663.90M
	EBIT
-154.80M	-314.90M	-540.30M	-493.00M	-273.30M
	EBITDA
-65.60M	-216.40M	-500.30M	-428.50M	-220.10M
	Net Income Common Stockholders
-154.40M	-321.30M	-589.30M	-492.80M	-270.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
223.80M	166.90M	361.90M	618.30M	440.10M
	Total Assets
1.18B	1.16B	1.53B	1.80B	1.37B
	Total Debt
497.60M	533.90M	763.00M	580.70M	512.40M
	Net Debt
273.80M	367.00M	401.10M	-37.60M	72.30M
	Total Liabilities
765.60M	728.30M	1.01B	953.00M	741.30M
	Stockholders Equity
409.40M	428.70M	517.10M	843.80M	623.80M
Cash Flow		Free Cash Flow
105.80M	-37.10M	-361.80M	-78.70M	-101.40M
	Operating Cash Flow
121.50M	-25.90M	-291.70M	-28.60M	-58.10M
	Investing Cash Flow
-36.60M	-11.70M	-100.10M	-192.50M	-13.40M
	Financing Cash Flow
-28.00M	-157.40M	135.40M	399.30M	19.90M

Compass Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COMP, the sentiment is Negative. The current price of 6.16 is above the 20-day moving average (MA) of 6.09, below the 50-day MA of 7.10, and below the 200-day MA of 6.90, indicating a neutral trend. The MACD of -0.29 indicates Negative momentum. The RSI at 42.49 is Neutral, neither overbought nor oversold. The STOCH value of 67.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for COMP.

Compass Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PYCR	74 Outperform	$4.09B	―	-1.66%	―	15.72%	74.59%
LYFT	70 Outperform	$6.53B	115.10	8.56%	―	27.32%	―
Sector *	61 Neutral	$2.83B	10.98	0.41%	8438.90%	5.81%	-21.06%
ALIT	59 Neutral	$2.94B	―	-0.82%	1.47%	-26.04%	85.84%
ASAN	58 Neutral	$3.50B	―	-83.36%	―	9.84%	13.74%
INTA	58 Neutral	$4.71B	―	-4.16%	―	17.70%	61.98%
COMP	49 Neutral	$3.34B	―	-14.96%	―	19.05%	78.91%

Compass Corporate Events

Compass Adopts Deferred Compensation Plan for Executives

On May 29, 2025, Compass, Inc. adopted a Deferred Compensation Plan allowing directors and selected executives to defer taxable income in compliance with tax regulations. At the annual meeting on May 22, 2025, stockholders elected three directors, ratified the appointment of PricewaterhouseCoopers LLP as the independent auditor for 2025, and approved the 2024 executive compensation, indicating strong shareholder support for the company’s governance and financial strategies.

The most recent analyst rating on (COMP) stock is a Hold with a $5.00 price target. To see the full list of analyst forecasts on Compass stock, see the COMP Stock Forecast page.