A truly disruptive company is a sight to behold. It has the potential to change the way business is done. It has the potential to change how we live our lives. And Exp World Holdings (NASDAQ:EXPI) stock has the potential to do that.
Exp operates in the real estate arena. And like some of the best disruptive companies out there, it’s leveraging cutting-edge online tools while taking advantage of a generational change in how the real estate business is operated.
This isn’t the biggest company out there – it only has a market capitalization of about $7.3 billion. But EXPI stock is off to a strong start in 2021, generating a return so far of more than 60%.
What Is Exp World Holdings?
The company is a cloud-based residential real estate firm. It operates a cloud-based real estate brokerage, which allows local real estate agents to work remotely rather than operating out of a brick-and-mortar real estate office.
Based in Washington state, Exp is all-inclusive, offering real estate brokerages services, title and escrow services and mortgage brokerage services.
Now, here’s where things get really interesting. The company’s real estate agents also have access to a virtual world, called Exp World that it compares to the popular simulation video game The Sims.
In Exp World, the company’s agents, brokers and staff have personalized avatars that they move throughout a large online campus that has offices, conference rooms and even things like a beach and a soccer field.
Exp World Holdings also has a Facebook (NASDAQ:FB) product called Workplace, which allows employees to interact with each other quickly.
Agents split their commissions with Exp World Holdings by an 80/20 split. The company currently operates in the U.S., Canada and the United Kingdom.
EXPI Stock at a Glance
A year ago, EXPI stock was a penny stock. Not so much anymore.
EXPI is up 900% over the last 12 months, and that’s after tumbling nearly 27% over the last month.
Just within the last few days, Exp World Holdings released its fourth-quarter and full-year earnings. The results were dynamic.
Revenue came in at $609.3 million, which was a 122% increase from the same quarter a year ago. It also beat analysts’ estimates of $521.8 million. Profits were $50.4 million, which was a 106% increase from Q4 of 2019.
Earnings per share came in at 5 cents, which was a 400% increase from a year ago. But even so, it missed analysts’ estimates of 7 cents per share.
Exp World Holdings as a Disruptor
We do things a lot differently today than we did them 50 years ago. Whether it’s banking or shopping, consumer services have changed dramatically thanks to revolutionary advances in their industries.
So, why should real estate be any different?
Most people already want to make many of their transactions online. And while it’s almost always necessary to visit a house before making an offer, there doesn’t seem to be any reason to ever have to visit a real estate office these days.
Exp World Holdings is trying to entice real estate agents with a variety of perks, such as bigger commissions, stock options, health care and revenue sharing. And of course, its virtual world for employees.
It’s a powerful argument when Exp can offer a lower commission structure, health care, less overhead and a virtual office, particularly as we’ve been dealing with Covid-19 over the last year.
The Bottom Line
Exp World Holdings is a fast-growing cloud-based real estate brokerage that is dialed in to the needs of real estate professionals today. It’s embracing an online, cloud-based workforce. It’s making tools available online. It has a competitive commission structure.
As more of our worlds move online, the internet and cloud-based services will continue to disrupt business segments, and that’s what’s happening to real estate right now.
EXPI stock has an “A” rating and a strong buy recommendation in my Portfolio Grader.
On the date of publication, Louis Navellier had long position in FB. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system — with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation.