Financial Analysis: RE/MAX Holdings (RMAX) & SouFun Holdings Limited (SFUN)

RE/MAX Holdings (NYSE: RMAX) and SouFun Holdings Limited (NYSE:SFUN) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, analyst recommendations, valuation, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for RE/MAX Holdings and SouFun Holdings Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RE/MAX Holdings 2 3 2 0 2.00
SouFun Holdings Limited 2 3 2 0 2.00

RE/MAX Holdings presently has a consensus target price of $63.80, indicating a potential downside of 1.47%. SouFun Holdings Limited has a consensus target price of $3.63, indicating a potential downside of 13.46%. Given RE/MAX Holdings’ higher probable upside, equities analysts plainly believe RE/MAX Holdings is more favorable than SouFun Holdings Limited.

Insider & Institutional Ownership

46.9% of SouFun Holdings Limited shares are held by institutional investors. 0.6% of RE/MAX Holdings shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

RE/MAX Holdings has a beta of 0.93, suggesting that its stock price is 7% less volatile than the S&P 500. Comparatively, SouFun Holdings Limited has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500.

Profitability

This table compares RE/MAX Holdings and SouFun Holdings Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RE/MAX Holdings 12.45% 79.94% 11.81%
SouFun Holdings Limited -4.57% -8.80% -2.74%

Dividends

RE/MAX Holdings pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. SouFun Holdings Limited does not pay a dividend. RE/MAX Holdings pays out 55.0% of its earnings in the form of a dividend. RE/MAX Holdings has increased its dividend for 2 consecutive years.

Valuation & Earnings

This table compares RE/MAX Holdings and SouFun Holdings Limited’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
RE/MAX Holdings $187.03 million 6.13 $95.88 million $1.31 49.43
SouFun Holdings Limited $644.69 million 2.83 $9.32 million ($0.06) -69.83

RE/MAX Holdings has higher revenue, but lower earnings than SouFun Holdings Limited. SouFun Holdings Limited is trading at a lower price-to-earnings ratio than RE/MAX Holdings, indicating that it is currently the more affordable of the two stocks.

Summary

RE/MAX Holdings beats SouFun Holdings Limited on 10 of the 14 factors compared between the two stocks.

RE/MAX Holdings Company Profile

RE/MAX Holdings, Inc. is a franchisor in the real estate industry, franchising real estate brokerages around the world under the RE/MAX brand and mortgage brokerages within the United States under the Motto Mortgage brand. The Company is a franchised business, with all of the RE/MAX branded brokerage office locations being operated by franchisees, including RE/MAX, LLC, which owns the RE/MAX brand, and sells franchises and franchising rights; Independent Regional Franchise Owner, which owns rights to sell brokerage franchises in a specified region; Franchisee (or Broker-Owner), which operates a RE/MAX-branded brokerage office, lists properties and recruits agents, and Agent (or Sales Associate), including branded independent contractors operating out of local franchise brokerage offices. Under Motto business, the Company operates as a mortgage brokerage franchisor. As a franchisor, the Company helps its Motto franchisees to establish independent mortgage brokerage companies.

SouFun Holdings Limited Company Profile

Fang Holdings Limited, formerly SouFun Holdings Limited, operates as a real estate Internet portal in China. The Company’s Websites and mobile applications support active online communities and networks of users seeking information on, and services for, the real estate and home-related sectors in China. The Company, through its Internet platform, is engaged in the development of transaction and financing platforms by offering direct sales services for new homes, online real estate brokerage services and financial services. The Company’s service offerings include marketing services, E-commerce services, listing services, Financial services and other value-added services. The Company provides secured loans in the form of entrusted loans and mortgage loans and unsecured loans primarily to home buyers, real estate developers and other borrowers that meet its credit assessment requirements.

Receive News & Ratings for RE/MAX Holdings Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for RE/MAX Holdings Inc. and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply