REAX Stock Forecast & Price Target

Real Brokerage Inc. has demonstrated significant financial performance with revenue and gross profit reaching $540.8 million and $47.9 million, respectively, surpassing both internal and market expectations, driven by a remarkable 44% year-over-year increase in agent count. Additionally, approximately 45% of transactions in the third quarter were attributed to capped agents, indicating a growing trend toward enhanced profitability in ancillary services, including mortgage and title, which are nearing profitability and expected to contribute to margin expansion in the latter half of 2026. The company's ability to maintain strong organic growth, with a 1.7% increase in agent count quarter-to-date and a robust overall pipeline with a 4.1% uptick, positions Real Brokerage favorably to capitalize on market share opportunities amid increasing agent productivity and favorable commission structures.

Real Brokerage Inc. is experiencing a decline in gross margins, with the latest figures decreasing to 5.12% from 5.59% sequentially and 5.50% at the end of the previous quarter, primarily due to an increase in capped agents which is expected to continue negatively impacting margins in the coming quarters. The adjusted operating expense per transaction shows some scalability improvements, falling to $459, but this is overshadowed by a broader industry slowdown in home sales, leading to a downward revision in price targets. Furthermore, adverse weather conditions and seasonal factors are anticipated to reduce listing activity, exacerbating the challenges faced by the company and contributing to an overall negative outlook on its financial performance.