RLGY

Realogy Holdings Corp

Finance/Real Estate


Presented:07/18/2016
Price:$29.24
Cap:$4.28B
Current Price:$4.67
Cap:$0.52B

Presented

Date07/18/2016
Price$29.24
Market Cap$4.28B
Ent Value$8.97B
P/E Ratio24.99x
Book Value$16.10
Div Yield0%
Shares O/S146.50M
Ave Daily Vol1,580,899
Short Int2.87%

Current

Price$4.67
Market Cap$0.52B
Realogy Holdings Corp. is a preeminent and integrated provider of residential real estate services in the U.S. The company operates through four segments: Real Estate Franchise Services, Company Owned Real Estate Brokerage Services, Relocation Services, and Title & Settlement Services. The Real Estate Franchise Services segment franchises residential real estate brokerages through its brands which includes, Century 21, Coldwell Banker, Coldwell Banker Commercial, ERA, Sotheby's International Realty and Better Homes and Gardens Real Estate. The Company Owned Real Estate Brokerage Services segment own and operate the residential real estate brokerage business in the U.S. It offers full-service residential brokerage services. The Relocation Services segment provides outsourced employee relocation services. It provides services in the U.S. and also operates in key international relocation destinations. The Title & Settlement Services segment assists closing of real estate transactions by providing full-service title and settlement services to customers and real estate companies. Realogy Holdings was founded on December 14, 2006 and is headquartered in Madison, NJ.

Publicly traded companies mentioned herein: Realogy Holdings Corp (RLGY)

Highlights

Shares of Realogy Holdings (RLGY) - the largest residential real estate brokerage in the US (27% share) - represent an attractive value in the high $20s (~$29). The presenter is long the stock and sees the potential for meaningful upside for patient shareholders as management continues to reduce leverage (to 3x by year’s end) and buyback stock. The shares have underperformed due to financial leverage, slightly disappointing incremental operating leverage and worries about the health of the high-end real estate markets such as Miami, Hamptons, NYC and San Francisco. However, he said these worries seem to be adequately discounted in the share price with RLGY now trading at approximately 8-8.5x EBITDA and 7x forward free cash flow.

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Idea Discussion

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