Gordon Haskett analyst Robert Mollins downgraded Compass to Underperform from Hold with a price target of $2.25, down from $2.75. The firm see risk greater than reward with Compass shares materially outperforming peers year-to-date, the company named in several commission lawsuits that could upend the traditional agent commission model, the firm’s work pointing to transaction and GTV shortfalls in Q4 and consensus estimates “appearing aggressive,” a rate lock to persist and weigh on housing demand well into 2024, and stock-based comp accounting for “the lion’s share of positive adjusted EBITDA for the foreseeable future,” the analyst tells investors.
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