Marcus & Millichap (NYSE:MMI) Announces Quarterly Earnings Results, Beats Estimates By $0.07 EPS

Marcus & Millichap (NYSE:MMI) posted its quarterly earnings results on Thursday. The real estate investment trust reported $0.10 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.03 by $0.07, Zacks reports. The business had revenue of $202.91 million for the quarter, compared to analyst estimates of $194.30 million. Marcus & Millichap had a return on equity of 2.97% and a net margin of 1.77%.

Here are the key takeaways from Marcus & Millichap’s conference call:

• Second-quarter revenue rose 18% year over year to $203 million, with growth across brokerage and financing. Net income improved to $4 million, or $0.10 per share, from an $11 million loss, while adjusted EBITDA increased to $12 million from $1.5 million.
• Activity broadened across the platform: private-client brokerage revenue increased 14%, middle-market revenue rose 13%, and larger transactions jumped 43%. Financing revenue grew 15%, with refinancings representing 47% of financing revenue versus 39% a year earlier.
• Management expects additional operating leverage as revenue recovers, citing disciplined costs, technology investments, and revenue above the approximately $755 million annual level that previously produced break-even results. SG&A declined as a percentage of revenue to 35% from 42% a year earlier.
• The commercial real estate recovery remains uneven: higher and volatile interest rates are extending transaction timelines, and third-quarter pipeline growth is expected to be modest. Management remains encouraged by narrowing bid-ask spreads, improved lender liquidity, and greater seller motivation.
• Marcus & Millichap returned capital through $24 million of share repurchases during the quarter and declared a $0.25 semiannual dividend, while retaining $345 million in cash and marketable securities. The company also highlighted potential expansion in leasing, appraisal, investment management, and financing, including possible acquisitions.

Marcus & Millichap Stock Down 0.6%

Shares of MMI stock traded down $0.20 during trading hours on Friday, hitting $31.50. 118,020 shares of the company’s stock traded hands, compared to its average volume of 126,666. The stock’s fifty day simple moving average is $30.59 and its two-hundred day simple moving average is $28.26. Marcus & Millichap has a 12-month low of $24.43 and a 12-month high of $33.62. The stock has a market cap of $1.19 billion, a price-to-earnings ratio of 85.12 and a beta of 1.23.

Marcus & Millichap Announces Dividend

The firm also recently announced a dividend, which will be paid on Tuesday, October 6th. Stockholders of record on Tuesday, September 15th will be issued a dividend of $0.25 per share. This represents a dividend yield of 163.0%. The ex-dividend date is Tuesday, September 15th. Marcus & Millichap’s dividend payout ratio (DPR) is presently -5,000.00%.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in MMI. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its holdings in Marcus & Millichap by 4.5% during the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 13,952 shares of the real estate investment trust’s stock valued at $481,000 after purchasing an additional 600 shares during the period. Intech Investment Management LLC increased its stake in Marcus & Millichap by 8.1% in the 3rd quarter. Intech Investment Management LLC now owns 10,284 shares of the real estate investment trust’s stock worth $302,000 after buying an additional 767 shares in the last quarter. Price T Rowe Associates Inc. MD raised its holdings in Marcus & Millichap by 8.2% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 13,669 shares of the real estate investment trust’s stock valued at $374,000 after acquiring an additional 1,038 shares during the period. Kestra Advisory Services LLC bought a new stake in Marcus & Millichap during the fourth quarter valued at about $30,000. Finally, Inspire Investing LLC lifted its position in shares of Marcus & Millichap by 10.6% in the fourth quarter. Inspire Investing LLC now owns 17,152 shares of the real estate investment trust’s stock valued at $468,000 after acquiring an additional 1,640 shares in the last quarter. Institutional investors own 62.78% of the company’s stock.

Analysts Set New Price Targets

A number of analysts have recently weighed in on MMI shares. Wall Street Zen raised Marcus & Millichap from a “hold” rating to a “strong-buy” rating in a research note on Saturday. Weiss Ratings downgraded Marcus & Millichap from a “sell (d+)” rating to a “sell (d)” rating in a report on Monday, May 11th. Two analysts have rated the stock with a Sell rating, According to data from MarketBeat.com, the stock currently has an average rating of “Sell” and an average target price of $28.00.

About Marcus & Millichap

Marcus & Millichap (NYSE: MMI) is a leading commercial real estate brokerage firm focused on investment sales, financing, research and advisory services. Founded in 1971 by George M. Marcus and William A. Millichap, the company has grown to specialize in the marketing of multifamily, retail, office, industrial, hospitality and other commercial property types. Through an extensive network of investment specialists, Marcus & Millichap connects property owners and investors with tailored transactions across a range of asset classes.

The firm offers comprehensive capital markets solutions, including debt and equity placement, structured finance, and customized financing programs.