What Happened?

Shares of real estate franchise company RE/MAX (NYSE:RMAX) fell 11.9% in the morning session after the company delivered disappointing fourth-quarter 2024 results: its full-year revenue guidance missed significantly and its EBITDA guidance for next quarter fell short of Wall Street's estimates. Revenue declined 5.4% year on year as the company saw a 4.8% drop in U.S. and Canadian agent count. On the other hand, RE/MAX beat analysts' EPS expectations this quarter and its EBITDA outperformed Wall Street's estimates. Overall, this quarter could have been better.

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What The Market Is Telling Us

RE/MAX’s shares are extremely volatile and have had 33 moves greater than 5% over the last year. But moves this big are rare even for RE/MAX and indicate this news significantly impacted the market’s perception of the business. 

The biggest move we wrote about over the last year was 4 months ago when the stock dropped 15.5% on the news that the company reported weak third-quarter earnings. Sales declined during the quarter due to a decrease in agent count and a reduction in revenue from previous acquisitions. In addition, revenue forecast for the next quarter was underwhelming, coming in below Wall Street's estimates. Overall, this was a weaker quarter for the company.

RE/MAX is down 12.6% since the beginning of the year, and at $9.05 per share, it is trading 35.5% below its 52-week high of $14.04 from November 2024. Investors who bought $1,000 worth of RE/MAX’s shares 5 years ago would now be looking at an investment worth $267.43.

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