Bank of America just raised its EUR/USD forecast
On Thursday, Keefe, Bruyette & Woods analyst Ryan Tomasello adjusted Zillow ’s (NASDAQ:Z) price target, bringing it down to $74 from the previous $76, while keeping a Market Perform rating on the stock. The revision follows Zillow’s first quarter results, which surpassed expectations in terms of revenue and EBITDA, primarily due to strong performance in the Rentals and Residential segments.
Zillow’s recent partnership with Redfin (NASDAQ:RDFN) is expected to bolster the Rentals outlook, with projections of a 40% year-over-year increase by 2025, exceeding the estimates of Keefe, Bruyette & Woods and consensus, which stand at 29% and 28% respectively. Despite this positive development, the company’s For Sale revenue outlook appears less optimistic, suggesting an increase of only 6-9% in 2025, which is lower than the 10-11% anticipated by both Keefe, Bruyette & Woods and consensus.
Moreover, the guidance for second quarter EBITDA is also less promising, with expectations falling 10% below the consensus at the midpoint. Nevertheless, Zillow has chosen to maintain its consolidated full-year revenue and EBITDA outlook, while also acknowledging the increased uncertainty in the housing market.
In light of these factors, Tomasello has revised downward the EPS and EBITDA estimates for Zillow by 2-5%. This recalibration of expectations has led to the new price target of $74, reflecting a modest adjustment from the prior target. The Market Perform rating remains unchanged, indicating that the stock is anticipated to perform in line with the broader equity market.
In other recent news, Zillow Group (NASDAQ:ZG) reported a strong performance in the first quarter of 2025, with earnings per share (EPS) of $0.41, surpassing the forecasted $0.37. The company also achieved a revenue of $598 million, exceeding the anticipated $587.69 million. Despite these positive financial results, Zillow’s stock experienced a decline in aftermarket trading. The company’s rentals revenue reached an all-time high, growing 33% year-over-year. Zillow continues to expand its market presence with innovative products, contributing to a 13% year-over-year increase in total revenue. Looking ahead, Zillow expects revenue growth in the low to mid-teens for the full year 2025, with continued EBITDA margin expansion. Analyst discussions during the earnings call highlighted Zillow’s effective execution of its strategic initiatives and market expansion efforts. Additionally, the company is targeting significant growth in its rentals revenue and enhanced market connections by year-end.
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