How can a SoftBank-backed real-estate broker in a red-hot housing market lose $212 million in Q1? Compass Shows how.
By Wolf Richter for WOLF STREET.
Shares of Softbank-backed Compass, a real estate broker that calls itself “a tech company reinventing the space,” meaning the real estate broker space, dropped 5.5% today and closed at $13.66, having fallen 38% in 30 trading days from its intraday high on April 1, the day it started trading. It has now dropped 24% below its IPO price of $18. Despite the drop, its market cap is still $5.3 billion (data via YCharts):
Compass spent the past few years going around the US, buying up real estate brokerages and hiring brokers away from other brokerages, with the oodles of money it had raised as unicorn in various rounds of funding, including from Softbank – $1.5 billion in total.
But today’s stock move was a reaction to Compass’ first earnings report as a public company…