Should you sell your Real Matters stock?

National Bank of Canada Capital Markets analyst Richard Tse says Real Matters (Real Matters Stock Quote, Chart, News, Analysts, Financials TSX:REAL) delivered an in-line fourth quarter but continues to face an uncertain macro backdrop that is delaying any meaningful normalization in U.S. mortgage activity.

In a Nov. 20 report, he reiterated his “Sector Perform” rating and C$7.00 price target, calling the current setup “a balanced risk-to-reward profile.”

Markham, Ontario-based Real Matters provides network-management services to mortgage lenders and insurance companies across the U.S. and Canada.

The company reported fiscal Q4’25 consolidated net revenue of US$11.9-million, essentially flat year over year and quarter over quarter, compared with Tse’s US$12.0-million estimate and consensus at US$12.2-million. Net-revenue margin was 25.8%, down from 26.3% a year earlier. Adjusted EBITDA came in at US$0.1-million versus consensus at US$0.3-million.

Tse said smaller segments such as U.S. Title and Canada performed well, but “the core U.S. Appraisal segment is still lagging due to the continued soft macro environment.”

U.S. Appraisal net revenue declined 6% year over year, weighed down by an 11-per-cent drop in purchase-origination revenue and an equivalent decline in volumes. Tse noted the comparison was also difficult due to a temporary volume boost from a top client in the year-earlier period following a competitor cybersecurity incident.

Real Matters launched another U.S. Appraisal client in the quarter, but Tse said transaction volumes will likely “remain challenged until there is a broader pullback in rates.”

He pointed, however, to ongoing client wins as a sign of longer-term potential. The company onboarded six new clients in the quarter, including a Tier-1 lender in U.S. Title and a top-15 mortgage lender in U.S. Appraisal.

“These developments, combined with available capacity and disciplined cost management, position Real Matters well for operating leverage when volumes recover,” he said.

Tse said macro conditions remain the defining constraint. In calendar Q3, the average 10-year U.S. Treasury yield fell 10 basis points quarter over quarter but remained 41 basis points higher than a year earlier. The 30-year fixed mortgage rate averaged 6.57%, easing slightly into quarter-end but still above levels that would meaningfully stimulate refinancing. Management believes rates below 6% would materially unlock demand.

He said the Oct. 1 closing of Rocket’s acquisition of Mr. Cooper, one of Real Matters’ largest appraisal customers, is a potential catalyst once broader mortgage conditions improve. Rocket will use the Mr. Cooper platform for servicing, and Tse said the resulting increase in origination volumes could begin to show in either fiscal Q1 or Q2, contingent on rate relief.

“For now, the company remains resilient as it waits for an inflection in volumes,” Tse said, adding that it is still unclear whether transaction activity will shift back to traditional lenders once the market stabilizes.

Tse expects Real Matters to generate approximately US$5-million in Adjusted EBITDA on US$51.6-million in revenue in fiscal 2026.

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