Fathom Holdings (FTHM) AI Stock Analysis

• Market Cap: $56.01M
• Dividend Yield: N/A
• Average Volume (3M): 867.41K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.85
• Revenue Growth: 19.16%
• EPS Growth: 12.99%
• Country: US
• Employees: 270
• Sector: Real Estate
• Sector Strength: 55
• Industry: Real Estate - Services
• EPS (TTM): -0.13
• Shares Outstanding: 28,147,121
• 10 Day Avg. Volume: 2,271,989
• 30 Day Avg. Volume: 867,411
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 0.13
• Enterprise Value/Gross Profit: 2.20
• Enterprise Value/Ebitda: -2.85
• 1Y Price Target: $2.00
• Price Target Upside: 0.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 57 Neutral
• Price Target: $2.50 ▲(25.63% Upside)

Fathom Holdings' stock score is primarily influenced by its challenging financial performance, with ongoing profitability and cash flow issues. However, positive technical indicators and a promising earnings call with strategic expansions provide a more optimistic outlook. Valuation concerns persist due to negative earnings.

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. provides cloud-based real estate brokerage services in the South, Atlantic, Southwest, and Western parts of the United States. It operates through three segments: Real Estate Brokerage, Mortgage, and Technology. The Real Estate Brokerage segment provides real estate brokerage services. The Mortgage segment offers residential loan origination and underwriting services. The Technology segment provides Software as a Service solutions and data mining for third party customers to develop its intelliAgent platform for use by the company's real estate agents. The company operates a real estate services platform that integrates residential brokerage, mortgage, title, and insurance services, as well as supporting software called intelliAgent. It offers access to various properties for sale or lease through its FathomRealty.com website to buyers, sellers, landlords, and tenants. Its intelliAgent real estate technology platform provides a suite of brokerage and agent level tools, technology, business processes, business intelligence and reporting, training, customer relationship management, social media marketing and other marketing, and marketing repository services, as well as marketplace for add-on services and third-party technology. The company's brands include Fathom Realty, Dagley Insurance, Encompass Lending, intelliAgent, LiveBy, Real Results, Verus Title, and Cornerstone. Fathom Holdings Inc. was founded in 2010 and is headquartered in Cary, North Carolina.

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	390.03M	335.18M	345.23M	412.96M	330.23M	176.78M
Gross Profit	23.81M	28.27M	28.29M	27.17M	21.50M	10.42M
EBITDA	-18.34M	-16.64M	-17.31M	-21.43M	-13.36M	-1.12M
Net Income	-23.59M	-21.58M	-23.98M	-27.63M	-12.49M	-1.34M
Balance Sheet
Total Assets	80.45M	75.40M	79.26M	80.19M	104.93M	35.22M
Cash, Cash Equivalents and Short-Term Investments	5.12M	7.13M	7.40M	8.32M	37.83M	28.58M
Total Debt	23.31M	18.79M	17.57M	11.12M	14.99M	980.80K
Total Liabilities	39.75M	30.72M	24.02M	18.17M	24.78M	5.57M
Stockholders Equity	40.70M	44.68M	55.23M	62.02M	80.15M	29.65M
Cash Flow
Free Cash Flow	-12.25M	-7.93M	-12.40M	-10.64M	-15.18M	-1.96M
Operating Cash Flow	-12.32M	-4.69M	-10.57M	-6.58M	-11.70M	-1.21M
Investing Cash Flow	-357.00K	3.30M	-1.87M	-7.10M	-14.56M	-909.75K
Financing Cash Flow	7.02M	1.24M	11.60M	-15.86M	34.62M	31.11M

Fathom Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.99
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• 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 1.99 is above the 20-day moving average (MA) of 1.46, above the 50-day MA of 1.36, and above the 200-day MA of 1.27, indicating a bullish trend. The MACD of 0.18 indicates Negative momentum. The RSI at 60.33 is Neutral, neither overbought nor oversold. The STOCH value of 44.31 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	$1.12B	―	-31.81%	―	72.57%	65.15%
EXPI	67 Neutral	$1.70B	―	-12.78%	1.85%	3.55%	-36.05%
Sector *	63 Neutral	$7.06B	14.07	-0.50%	6.96%	4.08%	-25.24%
FTHM	57 Neutral	$56.01M	―	-50.22%	―	19.16%	12.99%
DOUG	56 Neutral	$241.29M	―	-36.97%	―	8.64%	1.81%
RDFN	55 Neutral		―		―	5.11%	-29.67%
OPEN	53 Neutral	$3.27B	―	-41.33%	―	14.07%	27.59%

Fathom Holdings Corporate Events

Fathom Holdings Shareholders Approve Stock Incentive Plan Amendment

At the 2025 Annual Meeting of Shareholders, Fathom Holdings Inc. shareholders approved an amendment to the 2019 Omnibus Stock Incentive Plan, increasing the share reserve by 1,300,000 shares. The board had initially approved this amendment on June 28, 2025, pending shareholder approval. Additionally, the meeting saw the election of six board members for a one-year term and the ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the year ending December 31, 2025.