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Marcus & Millichap Inc (MMI)
NYSE:MMI
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Marcus & Millichap
(NYSE:MMI)
50Neutral
Positive Factors
Deal Volumes
Raising estimates slightly on modestly better deal volumes.
Larger Deals
Larger deals beginning to pick up, but smaller transactions remain challenged.
Negative Factors
Economic Uncertainty
Depressed deal activity, the challenging capital markets environment, and continued economic uncertainty present headwinds for MMI's brokerage and financing businesses.
External Growth
Investors are looking for more meaningful external growth, which has not materialized for the company.
Transaction Volumes
Transaction volumes continue to fall, with a significant year-over-year decrease as reported by RCA.
Marcus & Millichap (MMI) vs. S&P 500 (SPY)
Market Cap
$1.19B
Dividend Yield1.65%
Average Volume (3M)135.10K
Price to Earnings (P/E)―
Beta (1Y)1.25
Revenue Growth7.76%
EPS Growth63.55%
CountryUS
Employees897
SectorReal Estate
Sector Strength70
IndustryReal Estate - Services
Share Statistics
EPS (TTM)-0.32
Shares Outstanding39,138,040
10 Day Avg. Volume149,803
30 Day Avg. Volume135,101
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.98
Price to Cash Flow (P/CF)6.10
P/FCF Ratio6.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$30.00Price Target Upside-2.66% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering0
Marcus & Millichap Business Overview & Revenue Model
Company DescriptionMarcus & Millichap (MMI) is a leading commercial real estate brokerage firm specializing in investment sales, financing, research, and advisory services. The company operates across various sectors, including multifamily, retail, office, and industrial properties, providing tailored solutions to property owners, investors, and developers. With a vast network of experienced agents and market knowledge, Marcus & Millichap assists clients in maximizing the value of their real estate assets.
How the Company Makes MoneyMarcus & Millichap makes money primarily through commissions earned on the sale and financing of commercial real estate properties. The company's revenue model is heavily reliant on transaction volume, with agents earning fees based on the value of the real estate deals they facilitate. This includes sales of multifamily apartment buildings, retail centers, office properties, and more. In addition to sales commissions, Marcus & Millichap generates revenue from its financing services, where it arranges debt and equity financing for clients, earning fees for successfully securing funding. The company also benefits from its research and advisory services, which, although not a primary revenue source, enhance its brokerage services by providing clients with valuable market insights and strategic guidance.
Marcus & Millichap Financial Statement Overview
Summary
Marcus & Millichap is experiencing financial challenges with declining revenues and negative profitability. The income statement reflects operational difficulties, and cash flow is under stress. However, the balance sheet shows stability, providing some financial buffer.Income Statement
Marcus & Millichap has faced a challenging period with declining revenue and profitability. The TTM shows negative EBIT and net income, indicating operational challenges. Revenue growth has been negative over the past two years, with a significant decline in 2023 compared to 2022. Margins have also deteriorated, reflecting increased operational inefficiencies.45
Neutral
Balance Sheet
The company's balance sheet remains stable with a reasonable debt-to-equity ratio and a strong equity base. However, the decline in stockholders' equity and assets since 2022 poses some concern. Despite this, the equity ratio remains solid, providing a buffer against financial instability.65
Positive
Cash Flow
Marcus & Millichap has struggled with cash flow, reporting negative free cash flow and operating cash flow in recent periods. Despite this, there is a slight improvement in free cash flow in the TTM compared to 2023, but the operating cash flow to net income ratio remains unfavorable.50
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 696.06M | 645.93M | 1.30B | 1.30B | 716.91M | Gross Profit |
| 264.59M | 239.28M | 450.82M | 456.23M | 269.03M | EBIT |
| -32.91M | -59.37M | 137.40M | 189.36M | 53.61M | EBITDA |
| 2.75M | -25.89M | 150.65M | 201.08M | 64.51M | Net Income Common Stockholders |
| -12.36M | -34.03M | 104.22M | 142.47M | 42.84M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 343.11M | 349.13M | 489.29M | 566.01M | 401.41M | Total Assets |
| 869.80M | 878.41M | 1.00B | 1.05B | 779.12M | Total Debt |
| 84.22M | 87.74M | 82.09M | 77.31M | 78.60M | Net Debt |
| -69.22M | -83.01M | -153.76M | -304.83M | -164.55M | Total Liabilities |
| 238.98M | 233.14M | 290.20M | 348.89M | 232.29M | Stockholders Equity |
| 630.82M | 645.27M | 713.51M | 696.30M | 546.84M |
| Cash Flow | Free Cash Flow | |||
| 13.84M | -81.80M | 1.96M | 249.05M | 31.14M | Operating Cash Flow |
| 21.71M | -72.43M | 13.63M | 255.90M | 38.09M | Investing Cash Flow |
| -9.90M | 74.87M | -53.98M | -108.36M | -17.23M | Financing Cash Flow |
| -28.75M | -67.68M | -105.56M | -5.92M | -10.33M |
Marcus & Millichap Technical Analysis
Negative
30.82
Price Trends
35.87
Negative
37.19
Negative
37.26
Negative
Market Momentum
-0.60
Positive
42.86
Neutral
21.36
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMI, the sentiment is Negative. The current price of 30.82 is below the 20-day moving average (MA) of 33.75, below the 50-day MA of 35.87, and below the 200-day MA of 37.26, indicating a bearish trend. The MACD of -0.60 indicates Positive momentum. The RSI at 42.86 is Neutral, neither overbought nor oversold. The STOCH value of 21.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MMI.
Marcus & Millichap Risk Analysis
Marcus & Millichap disclosed 45 risk factors in its most recent earnings report. Marcus & Millichap reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Marcus & Millichap Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $34.98B | 36.87 | 11.61% | ― | 11.95% | -1.25% | |
66 Neutral | $10.11B | 18.69 | 8.37% | ― | 12.87% | 142.90% | |
61 Neutral | $4.21B | 15.62 | -3.65% | 12.27% | 6.29% | -21.37% | |
58 Neutral | $1.05B | ― | 199.35% | ― | -4.16% | -17.19% | |
58 Neutral | $1.86B | 29.98 | 4.92% | 1.16% | 10.67% | 47.10% | |
58 Neutral | $1.85B | 14.45 | 7.65% | ― | -0.50% | ― | |
50 Neutral | $1.19B | ― | -1.94% | 1.65% | 7.76% | 63.55% |
* Real Estate Sector Average
Performance Comparison
MMI
Marcus & Millichap
30.82
-1.07
-3.36%
CBRE
CBRE Group
115.95
28.96
33.29%
JLL
Jones Lang Lasalle
210.94
34.68
19.68%
RDFN
Redfin
8.21
2.47
43.03%
NMRK
Newmark Group
10.31
0.60
6.18%
CWK
Cushman & Wakefield
8.06
-1.52
-15.87%
Marcus & Millichap Earnings Call Summary
Earnings Call Date: Feb 14, 2025 | % Change Since: -16.70% | Next Earnings Date: May 2, 2025
Earnings Call Sentiment Positive
Marcus & Millichap reported a strong fourth quarter with the highest revenue in two years, significant growth in brokerage and financing revenue, and a return to profitability. However, challenges remain due to interest rate volatility, talent retention issues, and market uncertainty affecting acquisitions. Despite these challenges, the company's strong cash position and improved cost management provide a positive outlook.Highlights
Highest Quarterly Revenue in Two Years
Revenue for Q4 2024 was $240 million, up 44% compared to last year.
Significant Increase in Brokerage and Financing Revenue
Brokerage revenue increased 40% and financing revenue nearly doubled in Q4 2024.
Strong Performance in Larger Transactions
Revenue from middle market and larger transactions accelerated 56% and 88% respectively.
Improved Cost Management
SG&A as a percentage of revenue decreased by more than 13 percentage points compared to the prior year.
Return to Profitability
Net income for Q4 2024 was $8.5 million compared to a net loss of $10.2 million in the prior year.
No Debt and Strong Cash Position
The company remains well-capitalized with $394 million in cash, cash equivalents, and marketable securities.
Lowlights
Ongoing Interest Rate Volatility
Interest rate volatility remains a disruptive factor, affecting real estate pricing and investor sentiment.
Challenges in Talent Retention
Elevated turnover of trainees and newer agents due to market conditions.
Seasonal Decline Expected in Q1 2025
First quarter revenue is expected to be sequentially lower than Q4 due to the usual seasonality trend.
Market Uncertainty Affecting Acquisition Opportunities
Valuation and terms have been obstacles in strategic acquisitions, with some deals not moving forward due to market uncertainty.
Company Guidance
During the call, Marcus & Millichap reported strong performance for the fourth quarter of 2024, marking the highest quarterly revenue in two years at $240 million, a 44% increase compared to the previous year. Adjusted EBITDA was recorded at $18 million, with a net income of $8.5 million. For the full fiscal year, revenue grew by 8% to approximately $700 million, although the company faced a net loss of $12 million. The brokerage revenue saw a 40% increase, with transaction count up by 23% and transaction volume growth of 41%. Financing revenue nearly doubled, with a 139% increase in volume, due to expanded operations and increased access to lenders. The company's strategic efforts led to a higher than average closing ratio of deals, contributing to the strong results. The company closed 7,800 transactions amounting to $43.6 billion in volume, marking gains of 4% and 14% respectively over 2023. Despite challenges in the interest rate environment, Marcus & Millichap expressed cautious optimism for incremental transaction growth in 2025, highlighting ongoing investments in technology, talent acquisition, and strategic acquisitions to drive long-term growth.Marcus & Millichap Corporate Events
Executive/Board Changes
Marcus & Millichap Appoints New Acting Chief Accounting Officer
Neutral
Mar 27, 2025
Marcus & Millichap, Inc. announced the resignation of its Chief Accounting Officer, Kurt Schwarz, effective March 24, 2025. He will remain with the company until April 18, 2025, with no disagreements or issues related to his departure. Fabrice De Bosschère has been appointed as the acting Chief Accounting Officer effective March 25, 2025, pending formal appointment by the Board on May 1, 2025. De Bosschère, who has been with the company since January 2022, brings extensive international finance and accounting experience from his previous roles at Publicis Groupe.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.