Realogy Holdings Corp. provides real estate services. It operates through four segments: Real Estate Franchise Services (RFG), Company Owned Real Estate Brokerage Services (NRT), Relocation Services (Cartus), and Title and Settlement Services (TRG). The RFG segment franchises its real estate brokerage franchise systems under the Century 21, Coldwell Banker, Coldwell Banker Commercial, ERA, Sotheby's International Realty, and Better Homes and Gardens Real Estate brand names to real estate brokerage businesses. As of December 31, 2016, this segment's real estate franchise systems had approximately 14,100 offices; and approximately 273,200 independent sales associates worldwide. The NRT segment owns and operates a full-service residential real estate brokerage business primarily under the Coldwell Banker, Corcoran, Sotheby's International Realty, ZipRealty, and Citi Habitats brand names to assist home buyers and sellers in listing, marketing, selling, and finding homes. The Cartus segment offers outsourced employee relocation services, such as homesale assistance; expense processing, relocation policy counseling, relocation-related accounting, and other consulting services; arranging household goods moving services; coordinating visa and immigration support, intercultural and language training, and expatriation/repatriation counseling and destination services; and group move management services to corporate clients for the transfer of their employees, as well as home buying and selling assistance to members of affinity clients. The TRG segment provides title and settlement services to real estate companies, affinity groups, corporations, and financial institutions. This segment also serves as an underwriter of title insurance policies in connection with residential and commercial real estate transactions. Realogy Holdings Corp. was incorporated in 2006 and is headquartered in Madison, New Jersey.
Business Analysis of Realogy Holdings
The Real Estate & REITs Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Realogy Holdings compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Realogy Holdings to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of Realogy Holdings with an interactive chart.
- Revenue Growth: Realogy Holdings reported a revenue growth of 1.8% year-on-year during 2016. Real Estate Services Industry grew at 12.5% in the same period
- COGS share of Revenues: As a percentage of revenue, Realogy Holdings spent 77.2% of its total revenues on COGS. Real Estate Services industry average (COGS share of revenue) in the same period was 53.7%
- R&D share of Revenues: Realogy Holdings R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, Realogy Holdings spent 9.7% of its total revenues on Sales, Marketing, and General Administration (SG&A). Real Estate Services industry average SG&A spending in the same period was 35.1%
- Inventory share of Revenues: Realogy Holdings Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: As a percentage of revenue, Realogy Holdings invested 2.9% of its total revenues on Accounts Payable (A/P) Real Estate Services industry average Accounts Payable investment in the same period was 8.9%
- Accounts Receivable share of Revenues: As a percentage of revenue, Realogy Holdings invested 2.6% of its total revenues on Accounts Receivable (A/R). Real Estate Services industry average Accounts Receivable investment in the same period was 22.2%
- PP&E share of Revenues: As a percentage of revenue, Realogy Holdings invested 4.6% of its total revenues on Property, Plants, and Equipments (PP&E). Real Estate Services industry average PPE investment in the same period was 24.4%
- Intangibles share of Revenues: As a percentage of revenue, Realogy Holdings invested 105.2% of its total revenues on Intangibles. Real Estate Services industry average Intangibles investment in the same period was 46.6%
- Net Margins: Realogy Holdings Net Margins in the year 2016 were 3.7%. Real Estate Services industry average Net Margins in the same period were 4.5%
Sector and Industry Association of Realogy Holdings
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
Realogy Holdings is associated with Financials Sector Group, Real Estate & REITs Sector, and Real Estate Services Industry.
Real Estate & REITs (Real Estate Investment Trusts) sector is comprised of the following industries: Diversified REITs; Industrial & Office REITs; Hotel & Lodging REITs; Retail REITs; Residential REITs; Specialty REITs; Mortgage REITs; Real Estate Holding & Development; Real Estate Services. The definitions for each of the industries is as follows:
- Diversified REITs industry includes REITs or corporations that invest in a variety of property types without a concentration on any single type.
- Industrial & Office REITs industry includes REITs that primarily invest in office, industrial, and flex properties.
- Hotel & Lodging REITs industry includes REITs that primarily invest in hotels or lodging properties.
- Retail REITs industry includes REITs that primarily invest in retail properties, malls, shopping centers, strip centers and factory outlets.
- Residential REITs industry includes REITs that primarily invest in residential home properties, apartment buildings, and residential communities.
- Specialty REITs industry includes REITs that invest in self storage properties, properties in the health care industry such as hospitals, assisted living facilities and health care laboratories, and other specialized properties such as auto dealership facilities, timber properties and net lease properties.
- Mortgage REITs industry includes REITs that are directly involved in lending money to real estate owners and operators or indirectly through the purchase or mortgages or mortgage backed securities.
- Real Estate Holding & Development industry includes companies that invest directly or indirectly in real estate through development, investment or ownership.
- Real Estate Services industry includes companies that provide services to real estate companies but do not own the properties themselves. It includes agencies, brokers, leasing companies, management companies and advisory services.
Industry Ranking of Realogy Holdings
With $5.8 billion revenues, Realogy Holdings ranked number 3 of all the companies in the US Real Estate Services industry. There were a total of 10 public companies in the US Real Estate Services industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Real Estate Services industry by revenues during 2016 were:
- CBRE Group ($13.1 billion)
- JLL ($6.8 billion)
- Realogy Holdings ($5.8 billion)
- Altisource Portfolio Solutions ($997.3 million)
- Blue Bird ($932 million)
- Marcus & Millichap ($717.5 million)
- Kennedy-Wilson Holdings ($703.4 million)
- HFF ($517.4 million)
- RMR Group ($266.9 million)
- Re/Max Holdings ($176.3 million)
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.
- Conduct a holistic benchmarking; to identify and target additional sources of value
- Get in touch with us to learn more about Business Model Analysis Framework
- Get free data, charts, and analysis of Realogy Holdingsand its peers on select key performance indicators by clicking the reports provided below