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On Wednesday, Benchmark analyst Daniel Kurnos raised the price target on Zillow Group (NASDAQ:ZG) to $110 from the previous $100, while reaffirming a Buy rating for the company’s shares. According to InvestingPro data, the stock has shown remarkable momentum, delivering a 70.82% return over the past six months and currently trading near its 52-week high of $86.58. Kurnos highlighted Zillow’s transparency regarding its short-term and long-term goals, as well as the total addressable market (TAM) during the earnings call the previous night. He noted that the fourth quarter results were generally strong, overcoming aggressive consensus expectations, with a substantial contribution from the mortgage segment. The company’s solid performance is reflected in its impressive 13.12% revenue growth and healthy gross margin of 76.44%. InvestingPro subscribers can access 14 additional key insights about Zillow’s financial health and growth prospects.
Despite the positive outcome, Kurnos pointed out that the first-quarter outlook fell short of expectations, with revenue and EBITDA projections below Wall Street’s forecasts. The analyst mentioned that this was partly due to a pull-forward in mortgage revenue and a sluggish start to the housing market in the early part of the year. Nonetheless, he emphasized the potential impact of a new partnership with Redfin (NASDAQ:RDFN), which is expected to significantly expand over the next two years.
Kurnos expressed confidence in Zillow’s ability to generate an additional $1 billion in residential revenue, even in a stagnant housing market. He also cited the company’s ambitious targets for market connection coverage and a mid-cycle margin of 45% as factors that should satisfy long-term investors. This optimistic outlook aligns with InvestingPro analysis, which shows six analysts revising their earnings estimates upward for the upcoming period, suggesting growing confidence in Zillow’s execution capabilities. Looking ahead to the rest of 2025, Kurnos suggested that, after adjusting for the first-quarter guidance, consensus estimates are likely to align closely with initial predictions.
In conclusion, the analyst recommended investors consider increasing their stakes in Zillow Group if the share price weakens, given the company’s new deals and scaling operations. He underscored the positive fourth-quarter EBITDA, which surpassed expectations by $4 million, as a sign of Zillow’s overall strong performance.
In other recent news, Zillow Group has been in the spotlight with multiple analysts adjusting their price targets after the company’s fourth-quarter results. Piper Sandler trimmed its target from $93 to $90 but retained an Overweight rating, noting Zillow’s conservative revenue growth expectations for the start of the year at 11%, down from the 17% growth in the fourth quarter.
On the other hand, BofA Securities raised its target from $81 to $84, following Zillow’s fourth-quarter earnings that slightly exceeded Wall Street’s expectations. The company reported revenue and EBITDA of $554 million and $112 million, marginally surpassing the anticipated $548 million and $109 million.
KeyBanc Capital Markets also revised its target, reducing it from $100 to $95, while maintaining an Overweight rating, despite Zillow’s fourth-quarter earnings not meeting KeyBanc’s projections. Meanwhile, Citi analyst Ronald Josey increased the price target from $95 to $98, highlighting Zillow’s significant revenue growth in its For Sale and Rentals segments.
Lastly, Cantor Fitzgerald analyst Deepak Mathivanan kept a Neutral rating but increased the price target from $62 to $70, following Zillow’s fourth-quarter earnings report, which exceeded analyst expectations. These recent developments provide a comprehensive view of the various analyst perspectives on Zillow Group’s performance.
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