RE/MAX Holdings (RMAX) Q4 Earnings: What's in the Cards?

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Real estate operations firm RE/MAX Holdings, Inc. RMAX is expected to report fourth-quarter 2016 results on Feb 23, after the market closes .

The company reported a positive earnings surprise of 6.67% in the preceding quarter, and an average beat of 7.16% for the trailing four quarters. The Zacks Consensus Estimate for the fourth-quarter is currently pegged at 37 cents.

Let's see how things have shaped up prior to this announcement.

RE/MAX Holdings, Inc. Price and EPS Surprise

RE/MAX Holdings, Inc. Price and EPS Surprise | RE/MAX Holdings, Inc. Quote

Factors to Consider

Denver, CO-based RE/MAX Holdings is a leading franchisor of real estate brokerage services with an enviable global footprint. The company enjoys a steady fee-based revenue model with robust cash flow and margins.

RE/MAX Holdings boasts a highly-productive network of over 110,000 agents. Number of agents is expected to rise by 6% to 6.5% in fourth-quarter 2016 on a year-over-year basis, driven by strong agent growth outside the U.S. and Canada. This should have positive impact on the results.

Earnings Whispers

Our proven model does not conclusively show that RE/MAX Holdings will beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks ESP : Both the Most Accurate Estimate and the Zacks Consensus Estimate currently stand at 37 cents, which translate into an Earnings ESP of 0.00%.

Zacks Rank : RE/MAX Holdings' Zacks Rank #2 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident about an earnings beat.

Note that we caution against stocks with Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some REITs that you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Chesapeake Lodging Trust CHSP , expected to release earnings results on Feb 22, has an Earnings ESP of + 2.17% and a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .

Hersha Hospitality Trust HT has an Earnings ESP of +2.04% and a Zacks Rank #3. The company is expected to release results on Feb 22.

Welltower Inc. HCN is expected to release results on Feb 22. It has an Earnings ESP of +0.93 % and carries a Zacks Rank #3.

Note: All EPS numbers presented in this write up represent funds from operations (FFO) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

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Welltower Inc. (HCN): Free Stock Analysis Report

Hersha Hospitality Trust (HT): Free Stock Analysis Report

Chesapeake Lodging Trust (CHSP): Free Stock Analysis Report

RE/MAX Holdings, Inc. (RMAX): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: HT , CHSP , RMAX

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