La Rosa Acquires Franchisee Despite Negative EPS and $6.8M Revenue
November 21, 2023
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La Rosa ($NASDAQ:LRHC), a public traded company in the real estate sector, recently made a bold move by purchasing a Real Estate Brokerage Franchisee. Despite a GAAP Earnings Per Share of -$0.06 and total revenue of $6.8M, La Rosa made this strategic acquisition in order to expand their market share and further their growth in the real estate industry. La Rosa is a leader in the industry, offering real estate services such as global broker networks, real estate listings, market intelligence, and more. With this new acquisition, La Rosa is looking to increase their presence in the industry and gain more customers.
Despite the negative EPS and low revenue, La Rosa is confident that this acquisition will benefit them in the long run and lead to increased profits. It will be interesting to see how this acquisition affects La Rosa’s future prospects and whether they can turn it into a successful endeavor.
Earnings
Despite a negative EPS and $6.8M revenue reported in LA ROSA‘s latest earnings report for FY2023 Q2 as of June 30 2021, the company made a successful move by acquiring a franchisee. From the report, we can see that there was a 3.8% increase in total revenue from the previous year, but a 157.6% decrease in net income. However, LA ROSA has seen a steady growth in total revenue, increasing from 7.72M USD to 13.18M USD over the last three years. This acquisition is an indication that the company is still confident in its future, despite the negative EPS and revenue reported.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for La Rosa. More…
| Total Revenues | Net Income | Net Margin |
| 55.72 | -14.58 | -21.9% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for La Rosa. More…
| Operations | Investing | Financing |
| -1.09 | – | 1.67 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for La Rosa. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 15.51 | 4.47 | – |
Key Ratios Snapshot
Some of the financial key ratios for La Rosa are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| – | – | -25.6% |
| FCF Margin | ROE | ROA |
| -2.0% | -153.4% | -57.6% |
Stock Price
On Monday, LA ROSA stock opened at $1.4 and closed at $2.0, soaring by 19.6% from its previous closing price of $1.6. The franchisee provides a valuable and necessary service to the company, providing a potential for growth in the near future. This deal is indicative of the management’s confidence in the profitability of LA ROSA despite the current financial setbacks it is facing. This news caused the stock to surge and investors to remain optimistic about the company’s future prospects. Live Quote…
Analysis
GoodWhale conducted an analysis of LA ROSA‘s wellbeing and our findings are as follows. In terms of cashflows and debt, LA ROSA has an intermediate health score of 6/10, indicating that they might be able to pay off debt and fund future operations. We classified LA ROSA as a ‘cheetah’, a type of company that has achieved high revenue or earnings growth but is considered less stable due to lower profitability. Given its strengths in growth, medium levels of asset and profitability, and weak dividend payouts, LA ROSA may be appealing to investors who are mainly focused on capital gains. These investors may be looking to buy and sell the stock quickly to capitalize on the growth potential, rather than relying on sustained dividends. Investors with a higher risk tolerance may also find LA ROSA attractive due to its promising growth prospects. More…
Summary
LA ROSA has recently acquired a real estate brokerage franchisee. The company reported a GAAP EPS of -$0.06 and revenue of $6.8M. Despite the negative earnings, the stock price moved up the same day. This signals that investors are confident in the company’s potential for future growth.
Analysts suggest that LA ROSA may be able to turn their losses around by leveraging their newly acquired franchise to expand their operations and tap into new markets. With the right investments and strategies, LA ROSA could be a good option for investors looking to increase their portfolio’s returns.
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