Through its flagship OneSite platform, customers can increase revenues by improving their sales and marketing effectiveness, while also reducing costs by automating ongoing property management functions and simplifying tasks through data sharing.
As a result of RP’s innovation, apartment managers have seen improved quality of service for renters since some transactions can now be completed online.
A big part of RealPage’s growth has been through acquisitions. This past March, the company closed on its acquisition of NWP Services, which should enhance RP’s existing platform in energy management and back-office services. And then in May, management bought AssetEye to offer better performance evaluation.
RealPage Is Standing Strong
These deals bring RealPage’s acquisition total to 32, growing its customer base to 11,900, including the 10-largest multi-property organizations that own 10.6 million rental units. Management still sees plenty of room for future growth, as their technology remains underpenetrated.
RealPage reported very strong results in 2015 and that solid performance continued into the first quarter of this year. Revenues of $128.4 million were up 16% and revenue per unit jumped 9.2%, with an increase in the number of customers ordering more than one service. The recent growth in operating expenses moderated, and earnings-per-share jumped 55% to $0.17 from $0.11.
Results were also strong for RP stock’s second quarter. Earnings of $0.18 a share (versus $0.12 a share a year ago), were a penny above expectations. Revenues of $142.5 million jumped 25% and topped estimates by $1 million. EPS guidance for 2016 was $0.71 to $0.74 and revenues were for $567 to $573 million, coming in line with consensus.
With 12% organic growth in subscription revenue and another 15% from acquisitions, its new offerings are meeting strong demand. Rental property continues to grow and low vacancies are giving property managers more money to spend. With sales expected to expand 14% next year, RP stock is not overvalued at 28X 2017’s EPS estimate in the current low interest rate environment.
With its strong franchise among apartment managers, recurring revenues and continued growth through new services, I see real potential in RP stock.
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