Critical Review: Marcus & Millichap (MMI) and Its Rivals

Marcus & Millichap (NYSE:MMI) is one of 31 public companies in the “REAL ESTATE DEV” industry, but how does it weigh in compared to its rivals? We will compare Marcus & Millichap to related businesses based on the strength of its earnings, valuation, institutional ownership, dividends, profitability, risk and analyst recommendations.

Dividends

Marcus & Millichap pays an annual dividend of $0.50 per share and has a dividend yield of 1.8%. Marcus & Millichap pays out -312.5% of its earnings in the form of a dividend. As a group, “REAL ESTATE DEV” companies pay a dividend yield of 2.7% and pay out 42.5% of their earnings in the form of a dividend.

Institutional and Insider Ownership

62.8% of Marcus & Millichap shares are owned by institutional investors. Comparatively, 52.7% of shares of all “REAL ESTATE DEV” companies are owned by institutional investors. 39.2% of Marcus & Millichap shares are owned by insiders. Comparatively, 38.3% of shares of all “REAL ESTATE DEV” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Marcus & Millichap and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marcus & Millichap	-0.89%	-0.58%	-0.43%
Marcus & Millichap Competitors	-14.50%	-44.25%	-1.74%

Analyst Ratings

This is a summary of current ratings and price targets for Marcus & Millichap and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marcus & Millichap	2	2	0	0	1.50
Marcus & Millichap Competitors	192	671	298	11	2.11

Marcus & Millichap presently has a consensus price target of $29.00, suggesting a potential upside of 5.92%. As a group, “REAL ESTATE DEV” companies have a potential upside of 24.57%. Given Marcus & Millichap’s rivals stronger consensus rating and higher probable upside, analysts plainly believe Marcus & Millichap has less favorable growth aspects than its rivals.

Volatility & Risk

Marcus & Millichap has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500. Comparatively, Marcus & Millichap’s rivals have a beta of -6.34, suggesting that their average share price is 734% less volatile than the S&P 500.

Valuation & Earnings

This table compares Marcus & Millichap and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Marcus & Millichap	$696.06 million	-$12.36 million	-171.12
Marcus & Millichap Competitors	$1.49 billion	-$82.46 million	2.57

Marcus & Millichap’s rivals have higher revenue, but lower earnings than Marcus & Millichap. Marcus & Millichap is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Marcus & Millichap beats its rivals on 8 of the 15 factors compared.

About Marcus & Millichap

Marcus & Millichap, Inc. engages in the provision of investment real estate brokerage services. It specializes in commercial real estate investment sales, property financing, research, and advisory services. The company was founded by George M. Marcus and William A. Millichap in 1971 and is headquartered in Calabasas, CA.