Is It Too Late To Consider Compass (COMP) After A 71% One Year Rally?

Simply Wall St

Wed, February 11, 2026 at 3:17 PM GMT+9 6 min read

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COMP

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If you are wondering whether Compass shares still offer value after a strong run, this article will walk through what the current price could mean for you as an investor.

The stock last closed at US$12.76, with returns of 4.8% over 7 days, a 0.6% decline over 30 days, 21.5% year to date and 71.5% over the past year. These numbers have put the question of valuation firmly on the table.

Recent headlines have focused on Compass as a pure play on the US housing and brokerage sector, with attention on how its tech enabled platform fits into a competitive real estate industry. Investors have been weighing that context against the share price moves you see in the recent return numbers.

On our checks, Compass scores 4 out of 6 on valuation, which you can see in more detail in its valuation scorecard. Next we will break that down across different valuation methods, before finishing with a broader way to think about what the market is really pricing in.

Compass delivered 71.5% returns over the last year. See how this stacks up to the rest of the Real Estate industry.

Approach 1: Compass Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company might be worth by projecting its future cash flows and then discounting those back to today in dollar terms. For Compass, the model used is a 2 Stage Free Cash Flow to Equity approach, which focuses on the cash that could theoretically be available to shareholders.

Compass last reported free cash flow of about $182.1 million. Analysts and internal estimates project free cash flow rising to $1.091b by 2030, with a detailed path for each year in between. The first several years are based on analyst inputs, and the later years are extrapolated using Simply Wall St assumptions to extend the cash flow curve out to 2035.

When all those projected cash flows are discounted back to today, the model arrives at an estimated intrinsic value of about $35.20 per share. Compared with the recent share price around $12.76, this implies the stock is 63.7% undervalued according to this DCF framework.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Compass is undervalued by 63.7%. Track this in your watchlist or portfolio, or discover 51 more high quality undervalued stocks.

COMP Discounted Cash Flow as at Feb 2026

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Compass.

Approach 2: Compass Price vs Sales

For companies where earnings are less useful, the P/S ratio is often a practical way to think about value because it anchors the share price to current revenue rather than accounting profits. Investors usually accept a higher or lower P/S depending on what they expect for future growth and how risky they think those revenues are, so there is no single “right” multiple in isolation.

Story Continues  

Compass currently trades on a P/S of 1.08x. That sits below the Real Estate industry average P/S of 2.50x and also below the peer group average of 1.83x. This suggests the market is assigning a lower value per dollar of sales than these benchmarks. Simply Wall St’s Fair Ratio for Compass is 0.73x, which is its proprietary view of what a “normal” P/S could look like after considering factors such as earnings growth, profit margins, industry, market cap and company specific risks.

This Fair Ratio can be more useful than a simple peer or industry comparison because it adjusts for those underlying characteristics rather than assuming every company deserves the same multiple. Since Compass trades at 1.08x versus a Fair Ratio of 0.73x, the shares screen as overvalued on this metric.

Result: OVERVALUED

NYSE:COMP P/S Ratio as at Feb 2026

P/S ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 23 top founder-led companies.

Upgrade Your Decision Making: Choose your Compass Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, a simple tool on Simply Wall St’s Community page that lets you write the story you believe about a company, link that story to specific forecasts for revenue, earnings and margins, and then see the fair value those assumptions imply. You can then compare this with today’s price and decide whether you think it looks attractive or not.

Each Narrative is updated automatically when fresh information such as news or earnings is added to the platform. With Compass you can already see how different investors interpret the same facts, with some Narratives tying a fair value around US$7.00 per share to more cautious expectations and others closer to US$11.00 based on stronger growth and margin assumptions.

For Compass, however, we will make it really easy for you with previews of two leading Compass Narratives:

🐂 Compass Bull Case

Fair value in this bullish Narrative: US$13.90 per share

Implied pricing gap vs last close of US$12.76: Compass trades about 8.2% below this fair value in the Narrative

Revenue growth assumption in this Narrative: 34.13%

Analysts in this camp link Compass AI enabled platform, cost control and integration of Anywhere and other acquisitions to higher revenue, better margins and a higher potential fair value.

They see additional earnings potential from higher attach rates in title, escrow and possible mortgage services, with tech helping those services slot into Compass core brokerage offering.

The risks they highlight focus on commission pressure, regulatory change and tech driven disruption, so the case rests on Compass using its platform and new scale to offset those headwinds.

🐻 Compass Bear Case

Fair value in this cautious Narrative: US$10.16 per share

Implied pricing gap vs last close of US$12.76: Compass trades about 25.6% above this fair value in the Narrative

Revenue growth assumption in this Narrative: 34.40%

This group accepts solid revenue growth assumptions but questions whether an agent centric model can sustain margins as direct to consumer and tech heavy models pressure commissions and fees.

They point to high commission splits, ongoing tech and integration spend and regulatory scrutiny on compensation as factors that could keep earnings and valuation under pressure.

They also see execution on the Anywhere deal as a key test, with fair value sensitive to whether Compass can translate the combined platform into consistent profitability rather than just higher scale.

Putting these together, you can think of the bullish Narrative as asking whether Compass earns the premium implied by stronger margins on a larger, tech enabled platform, while the cautious Narrative asks how much room is left in the price if margin and regulatory risks bite harder than expected. Your view on those trade offs is what ultimately matters for how you treat the current share price.

Curious how numbers become stories that shape markets? Explore Community Narratives

Do you think there’s more to the story for Compass? Head over to our Community to see what others are saying!

NYSE:COMP 1-Year Stock Price Chart

_ This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._

Companies discussed in this article include COMP.

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