Monthly Dividend Stock In Focus: Bridgemarq Real Estate Services

Up to date on March thirty first, 2025 by Felix Martinez

Bridgemarq Actual Property Companies (BREUF) has two interesting funding traits:

#1: It’s a high-yield inventory based mostly on its 10.4% dividend yield.
Associated: Listing of 5%+ yielding shares.
#2: It pays dividends month-to-month as a substitute of quarterly.
Associated: Listing of month-to-month dividend shares

You possibly can obtain our full Excel spreadsheet of all 76 month-to-month dividend shares (together with metrics that matter, like dividend yield and payout ratio) by clicking on the hyperlink under:

Combining a excessive dividend yield and a month-to-month dividend makes Bridgemarq Actual Property Companies interesting to income-oriented traders. The corporate additionally has a robust enterprise mannequin, with most of its revenues being recurring. On this article, we are going to focus on the prospects of Bridgemarq Actual Property Companies.

Desk of Contents

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Enterprise Overview

Bridgemarq Actual Property Companies offers varied providers to residential actual property brokers and REALTORS in Canada. It gives info, instruments, and providers that help its prospects within the supply of actual property providers. The corporate offers its providers below the Royal LePage, By way of Capitale, Johnston, and Daniel model names. The corporate was previously often called Brookfield Actual Property Companies and adjusted its identify to Bridgemarq Actual Property Companies in 2019. Bridgemarq Actual Property Companies was based in 2010 and is headquartered in Toronto, Canada.

Bridgemarq generates money move from mounted and variable franchise charges from a nationwide community of almost 21,000 REALTORS working below the aforementioned model names. Roughly 81% of the franchise charges are mounted in nature, leading to pretty predictable and dependable money flows. Franchise payment revenues are protected by way of long-term contracts.

Bridgemarq has a stable enterprise relationship with its companions, and thus, it enjoys remarkably excessive renewal charges. The corporate has traditionally achieved a 96% renewal fee at any time when a contract has expired.

Supply: Investor Presentation

Furthermore, Royal LePage’s franchise agreements, which comprise 96% of the corporate’s REALTORS, are 10-to 20-year contracts, offering nice money move visibility.

Bridgemarq has a dominant enterprise place in Canada. By means of its immense community of REALTORS, the corporate participated in over 70% of the overall house resales in Canada. Bridgemarq’s manufacturers appeal to franchisees due to their popularity and the technological benefits they supply.

Regardless of its sturdy enterprise mannequin, Bridgemarq was severely damage by the fierce recession attributable to the coronavirus disaster in 2020. The Canadian actual property market confronted an unprecedented downturn that 12 months. Consequently, the corporate noticed its earnings per share plunge 47%, from $0.34 in 2019 to $0.18 in 2020.

In 4Q2024, the corporate reported a 2024 income of $350.7 million, a pointy rise from $48.5 million in 2023, pushed by its $40.9 million acquisition of brokerages from Brookfield. Regardless of increased income, the corporate posted a web lack of $10.3 million (-$1.09 per share) as a result of a $9.3 million loss on Exchangeable Models. Free money move fell to $16.8 million from $18.1 million, whereas money offered by operations elevated by $3.4 million. The Board declared a month-to-month dividend of $0.1125 per share, payable April 30, 2025.

Progress Prospects

Bridgemarq pursues progress by repeatedly growing the variety of its companions.

Supply: Investor Presentation

Since 2017, the corporate has grown the variety of REALTORS by greater than 13%. Because of this, it now has 20,564 companions working via 282 franchise agreements at 723 places.

As talked about, the overwhelming majority of Bridgemarq’s franchise charges are mounted, which renders the corporate’s money flows pretty predictable. Nevertheless, that is simpler mentioned than carried out.

Bridgemarq has exhibited a considerably risky efficiency document over the past 9 years as a result of volatility in the actual property market and the swings of the change fee between the Canadian greenback and the USD. Nonetheless, the corporate has been capable of greater than double its adjusted earnings per share, from $0.35 in 2013 to $0.72 in 2024.

Given Bridgemarq’s sturdy enterprise place, long-term efficiency document, and a few progress limitations as a result of firm’s measurement, we anticipate roughly 4.0% common annual earnings per share progress over the following 5 years.

Dividend & Valuation Evaluation

Bridgemarq is providing an exceptionally excessive dividend yield of 10.4%, many instances the 1.3% yield of the S&P 500. The inventory is thus an fascinating candidate for income-oriented traders, however U.S. traders must be conscious that the dividend they obtain is affected by the prevailing change fee between the Canadian greenback and the U.S. greenback.

Bridgemarq has a payout ratio of over 100%, and its stability sheet doesn’t look superb. The corporate’s web debt is $182 million, over 100% of the inventory’s market capitalization. General, the corporate’s dividend will not be more likely to be diminished considerably within the absence of a extreme recession.

Then again, traders must be conscious that the dividend has remained primarily flat over the past 9 years. Thus, it’s prudent to not anticipate significant dividend progress going ahead.

Concerning the valuation, Bridgemarq has traded for 33.0 instances its earnings per share within the final 12 months. We assume a good price-to-earnings ratio of 14.0 for the inventory. Due to this fact, the present earnings a number of is far increased than our assumed honest price-to-earnings ratio. If the inventory trades at its honest valuation degree in 5 years, it is going to compress at 6% annualized in its returns.

Contemplating the 4.0% annual progress of earnings per share, the ten.4% dividend yield, and a 6% annualized compression of the valuation degree, Bridgemarq might provide a 7.4% common annual complete return over the following 5 years. This isn’t a lovely anticipated complete return, and therefore, we advise traders to chorus from shopping for the inventory round its present value.

Last Ideas

Bridgemarq has a dominant place in its enterprise and enjoys pretty dependable money flows due to the recurring nature of most of its charges. It additionally gives an exceptionally excessive dividend yield of 10.4% however a excessive payout ratio of over 100%, which makes it engaging for income-oriented traders.

Furthermore, Bridgemarq doesn’t have a lovely valuation proper now, because it has an anticipated 5-year annual complete return of seven.4%. The inventory’s excessive valuation has resulted primarily from a deceleration in enterprise momentum currently, however we anticipate the corporate to return to progress mode within the upcoming years due to its constant document of rising the variety of its companions. Due to this fact, traders ought to wait patiently for enterprise momentum to speed up once more.

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