Why eXp World Holdings Stock Surged by 11% Today
Key Points
The brokerage is capitalizing on strong demand for homes in this country.
It managed to flip into the black on the bottom line in its third quarter.
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Next-generation real estate brokerage eXp World Holdings (NASDAQ: EXPI) looked like an investment as safe as houses Friday. On the back of a solid quarterly earnings report, investors eagerly snapped up its shares to boost them to an over 11% gain on the day. With that performance, the stock trounced the S&P 500 (SNPINDEX: ^GSPC), which crawled up only by 0.1%.
Two beats in the third quarter
For its third quarter, eXp managed to increase its revenue by 7% year over year to $1.32 billion. A far more encouraging dynamic was apparent on the bottom line, as the company flipped to a net profit of almost $3.5 million ($0.02 per share) according to generally accepted accounting principles (GAAP), from the year-ago loss of over $8.5 million.
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With those numbers, eXp scored a double beat on analyst estimates. Collectively, pundits tracking the stock were modeling $1.24 billion on the top line, and non-GAAP (adjusted) per-share net income of $0.01.
eXp cited factors such as "continued momentum in agent growth," in addition to greater productivity and retention rates, as key reasons for the rises in the quarter.
Homes wanted
eXp certainly seems to have momentum on its side; total transactions rose by 3% year over year (to a total of 121,516), as did overall sales volume (up 7% to more than $54 billion). We're still in a high-demand environment for housing in this country, and it shouldn't be a problem for the company to slipstream along with this.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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