Redfin (RDFN) AI Stock Analysis

• Market Cap: $1.28B
• Dividend Yield: N/A
• Average Volume (3M): 7.26M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.05
• Revenue Growth: 5.11%
• EPS Growth: -29.67%
• Country: US
• Employees: 4,000
• Sector: Real Estate
• Sector Strength: 64
• Industry: Real Estate - Services
• EPS (TTM): -0.73
• Shares Outstanding: 128,031,170
• 10 Day Avg. Volume: 6,924,214
• 30 Day Avg. Volume: 7,258,753
• PEG Ratio: 0.15
• Price to Book (P/B): 27.34
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 26.12
• Enterprise Value/Market Cap: 1.43
• Enterprise Value/Revenue: 0.45
• Enterprise Value/Gross Profit: 5.02
• Enterprise Value/Ebitda: -3.94
• 1Y Price Target: $10.70
• Price Target Upside: 4.29% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7

• Rating: 50 Neutral
• Price Target: $10.00 ▼(-2.53%Downside)

Redfin's overall stock score reflects substantial financial challenges and valuation concerns, with persistent losses and high leverage being significant risks. Technical analysis provides a neutral to slightly positive outlook, while the merger with Rocket Companies presents potential strategic benefits but comes with legal uncertainties.

Positive Factors

Acquisition

The adjustment reflects Rocket Companies' announced agreement to acquire Redfin for $12.50 per share in an all-equity deal, valuing Redfin's equity at approximately $1.75 billion.

Earnings

Redfin reported 1Q revenue and adjusted EBITDA ahead of expectations.

Strategic Partnerships

Redfin will receive a guaranteed minimum payment of $75 million from Zillow for the first 12 months of lead generation services.

Negative Factors

Financial Performance

Redfin recorded an $18.9 million restructuring and reorganization expense during the quarter and expects additional restructuring costs in the next quarter.

Market Concerns

Redfin shares are currently trading at approximately 12% discount to the proposed acquisition price, reflecting concerns about regulatory scrutiny.

Profitability

Redfin's adjusted EBITDA loss was driven by Rentals and RE Services margins coming in below expectations.

Redfin Business Overview & Revenue Model

Company Description

Redfin Corporation (RDFN) is a technology-powered real estate brokerage that operates in the United States and Canada. It provides a range of real estate services, including home buying, selling, and rentals. Redfin leverages its proprietary software and technology to offer a customer-centric approach, featuring tools for online home search, virtual tours, and personalized service from Redfin agents. The company also provides ancillary services such as mortgage, title, and closing services to enhance the real estate transaction experience.

How the Company Makes Money

Redfin makes money primarily through commissions earned on real estate transactions facilitated by its agents. When a property is bought or sold through Redfin, the company receives a percentage of the sale price as a commission. Redfin charges a lower commission fee compared to traditional brokerages, which is part of its value proposition. Additionally, Redfin generates revenue from its ancillary services, including mortgage origination, title services, and closing services, which complement its core real estate brokerage operations. The company also makes money through advertising partnerships and fees associated with its rental marketplace. These diverse revenue streams are supported by Redfin's advanced technology platform, which enhances customer engagement and operational efficiency.

Redfin Financial Statement Overview

Summary

Redfin faces significant financial challenges, with persistent losses and negative equity indicating a stressed financial position. Despite some improvements in cash flow generation, the company struggles with profitability and high leverage, posing substantial risks. Sustainability of operations and financial health improvement are critical areas of focus moving forward.

Income Statement

The income statement reflects a challenging situation for Redfin, with declining revenue and persistent losses. Gross Profit Margin stands at 35.05% for TTM, indicating some efficiency in managing direct costs. However, the Net Profit Margin is negative, reflecting ongoing losses. Revenue growth has been declining, with a significant drop year-over-year from 2021 to 2022 and slight recovery thereafter, which poses a concern for sustainable growth. EBIT and EBITDA margins are negative, highlighting operational inefficiencies.

Balance Sheet

The balance sheet reveals a strained financial position with negative stockholders' equity in the TTM, indicating liabilities exceed assets. The Debt-to-Equity ratio is not meaningful due to negative equity, pointing to high leverage and potential risk. Return on Equity is negative, reflecting the company's inability to generate profits from shareholders' investments. The equity ratio is also negative, further emphasizing the financial instability.

Cash Flow

Cash flow analysis shows some positive aspects, with the TTM operating cash flow being positive, indicating an ability to generate cash from operations. Free Cash Flow has improved from negative in prior years to positive in the TTM, which is a positive sign. However, the Free Cash Flow to Net Income ratio is negative due to the negative net income, reflecting ongoing profitability challenges.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.04B	1.04B	976.67M	2.28B	1.92B	886.09M
	Gross Profit
364.02M	364.20M	329.82M	286.05M	403.82M	232.11M
	EBIT
-170.18M	-155.25M	-210.12M	-322.86M	-109.95M	792.00K
	EBITDA
-129.82M	-106.80M	-53.04M	-175.89M	-42.93M	21.87M
	Net Income Common Stockholders
-190.55M	-164.80M	-130.03M	-321.14M	-109.61M	-36.12M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
183.54M	124.74M	191.71M	362.10M	624.74M	1.06B
	Total Assets
1.08B	1.01B	1.15B	1.57B	2.02B	1.36B
	Total Debt
1.02B	994.90M	1.01B	1.35B	1.54B	635.04M
	Net Debt
833.69M	870.15M	860.05M	1.11B	949.38M	-290.24M
	Total Liabilities
1.23B	1.10B	1.11B	1.47B	1.67B	730.14M
	Stockholders Equity
-157.99M	-82.67M	42.71M	103.87M	349.72M	630.38M
Cash Flow		Free Cash Flow
40.67M	-43.52M	44.70M	18.96M	-329.06M	46.58M
	Operating Cash Flow
51.55M	-32.31M	56.76M	40.49M	-301.57M	61.27M
	Investing Cash Flow
-10.88M	34.41M	97.48M	-184.34M	-576.31M	-57.12M
	Financing Cash Flow
34.64M	-28.11M	-245.41M	-332.09M	650.34M	694.23M

Redfin Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 10.26
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RDFN, the sentiment is Positive. The current price of 10.26 is above the 20-day moving average (MA) of 10.01, above the 50-day MA of 9.47, and above the 200-day MA of 9.55, indicating a bullish trend. The MACD of 0.17 indicates Positive momentum. The RSI at 57.88 is Neutral, neither overbought nor oversold. The STOCH value of 52.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RDFN.

Redfin Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
REAX	70 Outperform	$876.35M	―	-52.95%	―	83.50%	8.45%
EXPI	67 Neutral	$1.38B	―	-6.44%	2.23%	6.69%	-137.52%
NMRK	65 Neutral	$2.16B	29.81	5.32%	1.05%	13.87%	90.42%
Sector *	61 Neutral	$2.85B	10.96	0.41%	8438.88%	5.73%	-21.25%
HOUS	58 Neutral	$437.16M	―	-6.84%	―	2.47%	-74.15%
RDFN	50 Neutral	$1.28B	―	199.35%	―	5.11%	-29.67%
OPEN	44 Neutral	$495.50M	―	-47.67%	―	2.36%	-23.60%

Redfin Corporate Events

Redfin Stockholders Approve Merger with Rocket Companies

On June 4, 2025, Redfin Corporation held a special meeting of stockholders to vote on two proposals related to a merger with Rocket Companies, Inc. The Merger Proposal and the Compensation Proposal were both approved, paving the way for Redfin to become a wholly owned subsidiary of Rocket. The merger is expected to close on or before July 1, 2025, following the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and the satisfaction of remaining conditions.

The most recent analyst rating on (RDFN) stock is a Hold with a $8.00 price target. To see the full list of analyst forecasts on Redfin stock, see the RDFN Stock Forecast page.

Redfin Faces Lawsuits Over Merger Proxy Statement

On May 5, 2025, Redfin Corporation filed a Definitive Proxy Statement with the SEC regarding a merger agreement with Rocket Companies, Inc. The merger proposal will be voted on by Redfin stockholders on June 4, 2025. Several lawsuits have been filed by Redfin stockholders alleging that the proxy statement is misleading and incomplete. Redfin denies these allegations but has issued supplemental disclosures to address the claims and avoid delays in the merger process. The company intends to defend against these lawsuits, which it considers without merit, and believes no additional disclosures are legally necessary.

The most recent analyst rating on (RDFN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Redfin stock, see the RDFN Stock Forecast page.

Redfin Merger with Rocket Companies Advances

On March 9, 2025, Redfin Corporation entered into a Merger Agreement with Rocket Companies, Inc. and Neptune Merger Sub, Inc., where Redfin will merge with Neptune Merger Sub and become a wholly owned subsidiary of Rocket. The expiration of the Hart-Scott-Rodino Antitrust Improvements Act waiting period on May 8, 2025, marked a significant step towards closing the merger, which is anticipated to be finalized in the second or third quarter of 2025, pending shareholder approval and other conditions.