Fathom Holdings (FTHM) AI Stock Analysis

• Market Cap: $32.50M
• Dividend Yield: N/A
• Average Volume (3M): 68.65K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.55
• Revenue Growth: 5.80%
• EPS Growth: 30.19%
• Country: US
• Employees: 270
• Sector: Real Estate
• Sector Strength: 55
• Industry: Real Estate - Services
• EPS (TTM): -0.18
• Shares Outstanding: 27,776,484
• 10 Day Avg. Volume: 70,504
• 30 Day Avg. Volume: 68,650
• PEG Ratio: -0.03
• Price to Book (P/B): 1.10
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -6.39
• Enterprise Value/Market Cap: 2.18
• Enterprise Value/Revenue: 0.05
• Enterprise Value/Gross Profit: 2.62
• Enterprise Value/Ebitda: -1.08
• 1Y Price Target: $1.50
• Price Target Upside: 28.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 54 Neutral
• Price Target: $1.00 ▼(-14.53%Downside)

Fathom Holdings' overall stock score reflects significant financial challenges with consistent losses and negative cash flows, which are the most impactful factors. Despite strong revenue growth and cost-cutting successes highlighted in the earnings call, ongoing operational inefficiencies and negative valuation metrics weigh heavily on the score. Technical indicators show mixed signals, offering some short-term potential.

Positive Factors

Agent Growth Potential

Acquisition of MyHomeGroup added ~2.2K highly productive agents, enhancing the potential for future growth.

Ancillary Services

Ancillaries grew ~42% year-over-year on 9% fewer transactions, indicating that investments in those services are proving beneficial.

Negative Factors

Financial Performance

3Q results fell short of expectations with continued housing pressure and marginally slower agent growth.

Transaction Decline

Transactions fell 9.4% year-over-year, with faster declines than the industry, impacting overall performance.

Fathom Holdings Business Overview & Revenue Model

Company Description

Fathom Holdings Inc. (FTHM) is a cloud-based real estate brokerage and technology company that operates in the United States. The company provides real estate services through its network of agents who leverage Fathom's proprietary technology platform to deliver superior service to clients. Fathom Holdings focuses on offering a range of real estate services including buying, selling, and leasing residential properties, with a commitment to innovation and efficiency.

How the Company Makes Money

Fathom Holdings primarily generates revenue through commissions earned from real estate transactions facilitated by its agents. As a cloud-based brokerage, Fathom offers a more flexible commission structure compared to traditional real estate firms, which can attract more agents to their platform. Additionally, the company benefits from its technology platform, which enhances agent productivity and efficiency, potentially leading to higher transaction volumes and increased revenue. Key revenue streams include commission splits with agents, technology fees, and ancillary services related to real estate transactions. Fathom's business model is also supported by its ability to scale operations without significant increases in fixed costs, allowing it to grow its agent network and transaction volume effectively.

Fathom Holdings Financial Statement Overview

Summary

Fathom Holdings faces significant financial challenges with consistent net losses and negative cash flows. While the debt levels are not excessively high, the deteriorating equity position and ongoing operational inefficiencies present substantial risks. The company needs to focus on improving revenue generation and cost management to stabilize its financial performance.

Income Statement

Fathom Holdings has experienced a revenue decline over recent periods, with its TTM revenue of $357.8M showing a slight increase from the previous annual revenue of $335.2M. However, the company has been consistently operating at a net loss, with a TTM net income of -$21.3M. Gross profit margins have been narrow, indicating ongoing challenges in managing cost of sales. The negative EBIT and EBITDA margins further highlight operational inefficiencies.

Balance Sheet

The company maintains a moderate debt-to-equity ratio, reflecting manageable leverage levels. However, the equity ratio has been declining, indicating a weakening asset base relative to equity. While the company's total assets have remained relatively stable, the declining stockholders' equity could pose risks for future capital raising or debt servicing.

Cash Flow

Fathom Holdings has consistently reported negative free cash flow, with a TTM free cash flow of -$10.0M, indicating ongoing cash burn. Operating cash flow is also negative, which suggests that the company is not generating sufficient cash from core operations to cover its expenses. The ratio of operating cash flow to net income is poor, reflecting challenges in converting accounting profit into actual cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	357.82M	335.18M	345.23M	412.96M	330.23M	176.78M
Gross Profit	27.02M	28.27M	28.29M	40.72M	29.72M	10.42M
EBITDA	-16.35M	-16.64M	-17.31M	-21.43M	-13.36M	-1.12M
Net Income	-21.30M	-21.58M	-23.98M	-27.63M	-12.49M	-1.34M
Balance Sheet
Total Assets	81.02M	75.40M	79.26M	80.19M	104.93M	35.22M
Cash, Cash Equivalents and Short-Term Investments	7.98M	7.13M	7.40M	8.32M	37.83M	28.58M
Total Debt	9.46M	18.79M	17.57M	11.12M	14.99M	980.80K
Total Liabilities	37.60M	30.72M	24.02M	18.17M	24.78M	5.57M
Stockholders Equity	43.41M	44.68M	55.23M	62.02M	80.15M	29.65M
Cash Flow
Free Cash Flow	-10.05M	-7.93M	-12.40M	-10.64M	-15.18M	-1.96M
Operating Cash Flow	-9.47M	-4.69M	-10.57M	-6.58M	-11.70M	-1.21M
Investing Cash Flow	3.02M	3.30M	-1.87M	-7.10M	-14.56M	-909.75K
Financing Cash Flow	8.66M	1.24M	11.60M	-15.86M	34.62M	31.11M

Fathom Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.17
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FTHM, the sentiment is Positive. The current price of 1.17 is below the 20-day moving average (MA) of 1.17, above the 50-day MA of 1.04, and below the 200-day MA of 1.55, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 54.37 is Neutral, neither overbought nor oversold. The STOCH value of 49.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FTHM.

Fathom Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
REAX	70 Outperform	$927.90M	―	-52.95%	―	83.50%	8.45%
EXPI	67 Neutral	$1.45B	―	-6.44%	2.16%	6.69%	-137.52%
Sector *	59 Neutral	C$1.23B	0.76	-8.20%	5.62%	9.89%	-25.14%
DOUG	57 Neutral	$210.31M	―	-23.11%	―	11.24%	38.70%
RDFN	55 Neutral	$1.44B	―	199.35%	―	5.11%	-29.67%
FTHM	54 Neutral	$32.50M	―	-44.60%	―	5.80%	30.19%
OPEN	44 Neutral	$407.15M	―	-47.67%	―	2.36%	-23.60%

Fathom Holdings Corporate Events

Fathom Holdings Expands Board, Appoints New Director

On March 17, 2025, Fathom Holdings Inc. announced the expansion of its board of directors from six to seven members and appointed Adam Rothstein as the new non-employee director. Rothstein, a venture investor with extensive experience in technology, media, and medical technology, will serve on several committees, including the newly formed Strategy and Innovation Committee. His appointment is expected to enhance Fathom’s strategic vision and drive long-term growth, benefiting agents, clients, and shareholders.