Why Compass (COMP) Stock Is Up Today

Max Juang /
2024/05/09 1:51 pm EDT

What Happened:

Shares of real estate technology company Compass (NYSE:COMP) jumped 18.6% in the afternoon session after the company reported first quarter results that beat analysts' revenue and adjusted EBITDA expectations. Notably, the company recorded a 7.1% growth in transactions despite a 3.5% decline for the entire residential real estate market in the first quarter, as reported by the National Association of Realtors. Guidance was also encouraging as next quarter's revenue guidance came in higher than Wall Street's estimates. Overall, this was a solid quarter for Compass.

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What is the market telling us:

Compass's shares are very volatile and over the last year have had 72 moves greater than 5%. But moves this big are very rare even for Compass and that is indicating to us that this news had a significant impact on the market's perception of the business.

Compass is up 10.8% since the beginning of the year, but at $3.93 per share it is still trading 11.2% below its 52-week high of $4.42 from July 2023. Investors who bought $1,000 worth of Compass's shares at the IPO in March 2021 would now be looking at an investment worth $194.68.

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