RE/MAX Holdings, Inc.

Where It Passes

Where It Falls Short

• Valuation0% pass✗ 28▾

  All 13 investors flag RMAX's valuation

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Book Ratio

  ✗Graham<= 1.5x

  P/E x P/B

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value2.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=2.1%, ROC=N/A (invested capital <= 0)

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)

  ✗Dreman< 8x

  Price / Book Value per Share

  ✗Dreman< 1.2x✗Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Valuation Reasonableness

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldFCF Yield=4.9%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical Average

  ✗MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share

  ✗Ackman<= 25

  Price vs. Trailing Low215% of trailing low ($5.75)

  ✗Templeton<= 120% of trailing low (certified split-adjusted live window)

  Net income / market capitalization-1.26%; #3449/6340 (top 54.4%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+0.6517; #2350/6449 (top 36.4%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change

  ✗SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.4156; #2873/5247 (top 54.8%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization+3.79%; #1854/4519 (top 41.0%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date+15.51%; #1569/6202 (top 25.3%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Verdicts0% pass✗ 12▾

  Split decision: 12 FAIL · 4 NEUTRAL

  Overall verdict

  ✗GrahamFAIL (1/9)✗BuffettFAIL (0/9)✗LynchFAIL (1/7)•GreenblattNot ranked•PiotroskiNEUTRAL (F-Score 6)✗DremanFAIL (1/11)✗MungerFAIL (0/4)✗PabraiFAIL (0/3)✗AkreFAIL (1/6)✗MarksFAIL (2/5)✗AckmanFAIL (2/9)✗TempletonFAIL (3/8)✗SleepFAIL (2/6)•AsnessNEUTRAL (Not ranked)✗NeffFAIL (2/6)•SchlossNEUTRAL (4/7)•OshaughnessyNEUTRAL (Not ranked)
• Profitability6% pass✓ 6✗ 29▾

  15 of 16 flag RMAX's profitability — Graham, Buffett, Lynch +12 more

  Positive EPS (10 years)8/16 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)13/16 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)-4.3%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)16.1% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$31.9M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE-1.9%

  ✗Lynch> 15%

  EBIT / Enterprise Value2.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=2.1%, ROC=N/A (invested capital <= 0)

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets2.31%

  ✓PiotroskiROA > 0

  ROA Change YoY1.39% -> 2.31% (delta: +0.92%)

  ✓PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=7.02%, ROA=2.31%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY

  ✗PiotroskiImproved YoY

  Pre-Tax Income / Revenue-1.8%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity-1.9%

  ✗Dreman> 12%

  Margin of Safety

  ✗PabraiP/B < 1.5 or P/E < 15

  Return on Equity-6.4% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency13/15 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue7.5%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity-1.9%

  ✗Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend-3.3% (2023) -> 16.1% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendrevenue flat/down, operating margin -3.3% -> 16.1%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Net income / market capitalization-1.26%; #3449/6340 (top 54.4%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity-1.94%; #3048/5226 (top 58.3%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0729; #3081/5884 (top 52.4%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years5/5 years positive

  ✓Schloss>= 70% positive over 5-10 observed years (app rule)
• Growth13% pass✓ 2✗ 11▾

  7 of 8 flag RMAX's growth — Graham, Lynch, Dreman +4 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthN/A (no inventory)

  ✓LynchInventory growth < Revenue growth

  EPS Growth Direction

  ✗DremanPositive over recent years

  EPS CAGR

  ✗Dreman> 5% annualized

  Positive Net Income Frequency13/15 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth-5.5%

  ✗Ackman>= 5%

  Positive EPS Growth Frequency

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendrevenue flat/down, operating margin -3.3% -> 16.1%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR1.9%

  ✗SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR

  ✗Neff7%-20% annualized
• Efficiency13% pass✓ 2✗ 9▾

  7 of 8 flag RMAX's efficiency — Graham, Buffett, Greenblatt +4 more

  Current Ratio1.54

  ✗Graham>= 2.0

  ROIC (3-5 yr avg)2.1%

  ✗Buffett> 10%

  ROIC - WACC-7.9%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)N/A (invested capital <= 0)

  ✗Greenblatt> 25%

  Current Ratio Change YoY1.41 -> 1.69

  ✓PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.53x -> 0.50x

  ✗PiotroskiImproved YoY

  Current Assets / Current Liabilities1.54

  ✓Dreman> 1.5

  Return on Invested Capital1.9%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=-1.0%; FY2024: ROIC=3.6%; FY2025: ROIC=4.2%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROICN/A (non-positive net income)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)0/5 years above 12% (latest 4.2%)

  ✗SleepROIC > 12% in a majority of years
• Debt & Leverage33% pass✓ 6✗ 9▾

  8 of 12 flag RMAX's debt & leverage — Graham, Buffett, Lynch +5 more

  Total Debt / Shareholders' Equity0.98

  ✗Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  LT Debt vs Net Current AssetsLT Debt $430.4M vs NCA $82.6M

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.97, IC: 1.5x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.98

  ✗Lynch< 0.33

  Cash - Long-term Debt$-318.1M

  ✗LynchPositive preferred

  LT Debt / Total Assets Change75.01% -> 74.19%

  ✓PiotroskiDecreased YoY

  Current Assets / Current Liabilities1.54

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Debt Levels0.98

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=1.5x, D/EBITDA=6.0x

  ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.98

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.9800; #3204/4210 (top 76.1%)

  ✗AsnessTop 30% of eligible cross-section
• Cash Flow40% pass✓ 5✗ 7▾

  6 of 10 flag RMAX's cash flow — Buffett, Lynch, Dreman +3 more

  Free Cash Flow Proxy$31.9M

  ✗BuffettPositive and growing

  FCF Positive and Growing$25.8M

  ✗LynchPositive and growing

  Operating Cash Flow$40.9M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=7.02%, ROA=2.31%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)

  ✗Dreman< 8x

  P/E or FCF YieldFCF Yield=4.9%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive15/15 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap

  ✗Ackman>= 4%

  Price / FCF per Share

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency15/15 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$25.8M

  ✓Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization+3.79%; #1854/4519 (top 41.0%)

  ✗OshaughnessyTop 10% of eligible cross-section