Compass (NYSE:COMP) Issues Earnings Results

Compass (NYSE:COMP) released its quarterly earnings results on Tuesday. The company reported $0.11 earnings per share for the quarter, beating analysts’ consensus estimates of $0.08 by $0.03, Zacks reports. The firm had revenue of $4.31 billion during the quarter, compared to analysts’ expectations of $4.11 billion. Compass had a return on equity of 4.56% and a net margin of 0.63%.

Here are the key takeaways from Compass’ conference call:

• Record Q2 performance: Revenue rose 14% year over year to $4.3 billion, while adjusted EBITDA reached a record $363 million, above the high end of guidance. Free cash flow was $180 million, lifting cash to $694 million and reducing net leverage to 3.3x.
• Compass outperformed the housing market, with brokerage transactions up 7.4% versus 3.5% market growth and gross transaction value up 16% versus 6% market growth. Management attributed the gains partly to its luxury-market exposure and stronger demand in the Bay Area.
• The company accelerated its integration savings, having already actioned its initial $300 million cost-synergy target five months ahead of schedule. It now expects $330 million of actioned synergies by year-end, with 2026 realized savings raised to $220 million, while suggesting the longer-term $500 million target could be exceeded.
• Adoption of Compass’s technology and marketing initiatives is expanding, with the Home Platform reaching nearly 50,000 additional owned-brand agents by September and Coming Soon listings approaching 57% of new Compass listings. Management expects 80% of Compass listings to launch as Coming Soon by the end of Q3 and cited strong traffic gains from the Rocket Redfin partnership.
• Q3 guidance calls for revenue of $3.85 billion to $4.05 billion and adjusted EBITDA of $275 million to $305 million, while full-year operating-expense guidance increased by $50 million, partly due to a recent brokerage acquisition and higher compensation costs. Management also emphasized that its long-term scenarios of up to $2.5 billion in adjusted EBITDA are illustrative rather than formal guidance.

Compass Stock Up 7.3%

Shares of NYSE:COMP opened at $12.87 on Thursday. The company has a fifty day moving average of $10.63 and a 200-day moving average of $9.73. The company has a debt-to-equity ratio of 1.11, a quick ratio of 0.84 and a current ratio of 0.84. The company has a market capitalization of $9.62 billion, a PE ratio of 214.53 and a beta of 2.36. Compass has a 52-week low of $6.37 and a 52-week high of $13.95.

Key Compass News

Here are the key news stories impacting Compass this week:

• Positive Sentiment: Strong Q2 performance: Revenue increased 14% year over year to $4.31 billion, exceeding the $4.11 billion analyst consensus. GAAP net income reached a record $92 million, while adjusted EBITDA was $363 million and operating cash flow totaled $191 million. Earnings of $0.11 per share also surpassed the $0.08 consensus estimate. Compass Reports Record Second Quarter 2026 Results
• Positive Sentiment: Cost synergies ahead of schedule: Compass completed its $300 million first-year net cost-savings target five months early and is now pacing toward approximately $330 million. The faster savings realization could support margins and future profitability. Compass Targets Q3 Revenue and Synergies
• Positive Sentiment: Above-consensus Q3 outlook: Management forecast third-quarter revenue of approximately $3.85 billion to $4.05 billion, ahead of the roughly $3.7 billion analyst estimate. The guidance suggests continued transaction growth despite a challenging housing market. Compass Shares Jump on Cost Savings and Transaction Growth
• Neutral Sentiment: CEO Robert Reffkin sold 23,456 shares for about $274,000 under a pre-arranged Rule 10b5-1 plan. The transaction reduced his direct holdings by only 0.30%, limiting its significance as a bearish signal. SEC Insider Trading Filing
• Neutral Sentiment: Management’s plans to expand Compass’s listings and portal strategy could improve consumer reach over time, but the potential benefits are longer term. Compass Portal Ambitions
• Negative Sentiment: Analyst target increases remain cautious: Wells Fargo raised its target to $13 with an “equal weight” rating, while Goldman Sachs raised its target to $12 and retained a “neutral” rating. These targets suggest limited upside after the recent rally. Analyst Price Target Updates

Analysts Set New Price Targets

A number of analysts recently commented on the stock. Weiss Ratings upgraded shares of Compass from a “sell (d-)” rating to a “sell (d+)” rating in a research report on Monday, May 11th. Morgan Stanley lifted their price objective on shares of Compass from $11.00 to $12.50 and gave the company an “equal weight” rating in a report on Wednesday, May 6th. BTIG Research restated a “buy” rating on shares of Compass in a research note on Wednesday, July 15th. Oppenheimer upped their price objective on Compass from $15.00 to $18.00 and gave the stock an “outperform” rating in a research note on Wednesday. Finally, Wells Fargo & Company boosted their target price on shares of Compass from $12.00 to $13.00 and gave the stock an “equal weight” rating in a report on Wednesday. Two investment analysts have rated the stock with a Strong Buy rating, eight have issued a Buy rating, three have issued a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat.com, Compass has an average rating of “Moderate Buy” and a consensus target price of $14.21.

Insider Buying and Selling at Compass

In other Compass news, CEO Robert L. Reffkin sold 23,456 shares of the stock in a transaction dated Monday, August 3rd. The shares were sold at an average price of $11.70, for a total value of $274,435.20. Following the completion of the sale, the chief executive officer owned 7,757,748 shares in the company, valued at approximately $90,765,651.60. This trade represents a 0.30% decrease in their position. The transaction was disclosed in a filing with the SEC, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 70,368 shares of company stock worth $748,246 over the last quarter. 2.85% of the stock is owned by corporate insiders.

About Compass

Compass, Inc is a technology-driven real estate brokerage firm that provides a full suite of services for home buyers, sellers and renters. Utilizing a proprietary software platform, the company equips its network of licensed real estate agents with data analytics, marketing automation and client relationship tools designed to enhance efficiency and transaction transparency.

Founded in 2012 by Ori Allon and Robert Reffkin, Compass has grown from a single office in New York City to serve more than 300 markets across the United States.