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On Monday, Bernstein analysts maintained their Market Perform rating on Zillow Group (NASDAQ:ZG) shares, with a steady price target of $65.00. Currently trading at $87.32, near its 52-week high of $88.15, InvestingPro analysis indicates the stock is trading above its Fair Value. Ahead of the company’s earnings report, slated for release after market close on Tuesday, February 11th, Bernstein’s analysis suggests a strong fourth-quarter performance is on the horizon for Zillow.
The anticipation of the earnings report is based on the belief that Zillow will surpass expectations for the quarter, driven by an increase in both the volume and pricing of existing home sales transactions. This optimism is supported by the company’s impressive 13.12% revenue growth and strong momentum, with a remarkable 68.18% price return over the past six months. This performance is expected to contribute to a significant uptick in the company’s Residential revenue.
Bernstein analysts project that the positive results in Residential revenue will also translate to an attractive EBITDA margin, as has been the case in previous quarters. The focus now shifts to Zillow’s guidance for the coming year, with particular attention on how the company plans to sustain growth. With six analysts recently revising their earnings estimates upward according to InvestingPro data (which offers 13 additional valuable insights), achieving the current Street estimates for Residential revenue in 2025 is considered attainable, yet it will likely require Zillow to gain additional market share to maintain its momentum.
Investors and analysts alike are looking forward to Zillow’s guidance, which will provide insights into the company’s strategies for growth and market share acquisition moving forward. The earnings report after the close on Tuesday is highly anticipated as it will offer a clearer picture of Zillow’s financial health and future prospects. For comprehensive analysis of Zillow’s performance and valuation metrics, access the detailed Pro Research Report available on InvestingPro.
In other recent news, Rocket Companies and other real estate-related stocks experienced significant gains following the release of the latest inflation data. The report indicated that core inflation in December rose less than expected, easing investor concerns about aggressive interest rate hikes. This development has prompted a positive response in the stock market and a more optimistic outlook for the industry.
In a recent development, Zillow Group, Inc. appointed Zuhairah Washington as Senior Vice President of Market Operations and General Manager of Flex (NASDAQ:FLEX). Washington, who has a notable professional background with companies like Uber (NYSE:UBER) and Expedia (NASDAQ:EXPE) Group, will focus on scaling operations and enhancing the company’s Flex agent program.
Meanwhile, Jefferies updated its outlook on Zillow, maintaining a Buy rating and increasing the price target to $105 from $92. The firm cited an anticipated approximately 50% recovery in Housing Transaction (JO:TCPJ) Value, an expansion of new products projected to provide over $500 million in incremental revenue by 2026, and Zillow’s low variable costs as reasons for the positive stance. This news reflects confidence in Zillow’s ability to continue its consistent pattern of financial performance.
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