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Zillow Group Inc Class A (ZG)
NASDAQ:ZG
Top Page
Zillow Group Class A
(NASDAQ:ZG)
Rating:64Neutral
Price Target:
$69.00
▲( 5.71% Upside)
Positive Factors
Partnerships
The Redfin partnership complements already robust Rentals growth.
Share Repurchase
Having repurchased ~3.3M shares (~$250M) in Q1, Zillow's Board authorized an additional $1B share repurchase program.
Technology and Innovation
Zillow has a massive tech moat that converts into a sustainable data advantage on both sides of the equation.
Negative Factors
Earnings Expectations
The Q2 revenue outlook was modestly below consensus, with adj. EBITDA guidance also below expectations, reflecting higher seasonal marketing costs and lead costs associated with the Redfin partnership.
Housing Market Conditions
The housing market remains muted and keeps the stock cautious for now.
Market Sentiment
Sentiment has been continuing to slowly shift away from belief in Zillow’s mid-cycle earnings power to questions around their ultimate ability to be a dominant share player in a consolidating market.
Zillow Group Class A (ZG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$15.66B
Dividend YieldN/A
Average Volume (3M)498.82K
Price to Earnings (P/E)―
Beta (1Y)1.34
Revenue Growth14.96%
EPS Growth49.24%
CountryUS
Employees6,819
SectorCommunication Services
Sector Strength86
IndustryInternet Content & Information
Share Statistics
EPS (TTM)0.41
Shares Outstanding51,874,170
10 Day Avg. Volume642,871
30 Day Avg. Volume498,816
Financial Highlights & Ratios
PEG Ratio-9.08
Price to Book (P/B)3.31
Price to Sales (P/S)0.00
P/FCF Ratio58.81
Enterprise Value/Market Cap1.02
Enterprise Value/Revenue1.88
Enterprise Value/Gross Profit9.32
Enterprise Value/Ebitda34.11
Forecast
1Y Price Target
$78.44Price Target Upside20.18% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering18
Zillow Group Class A Business Overview & Revenue Model
Company DescriptionZillow Group, Inc. Class A (ZG) is a leading online real estate marketplace company headquartered in Seattle, Washington. It operates in the real estate sector, offering digital solutions for homeowners, buyers, sellers, and real estate professionals. Core services provided by Zillow include property listings, real estate market analytics, and a platform for connecting with real estate agents. Zillow's platforms and applications serve as a comprehensive resource for individuals seeking to buy, sell, or rent properties, as well as for real estate professionals looking for marketing and advertising solutions.
How the Company Makes MoneyZillow Group generates revenue primarily through its online real estate marketplace and related services. Key revenue streams include: (1) Premier Agent: Zillow charges real estate agents for advertising and leads generated through its platform. Agents pay for enhanced visibility and access to potential clients. (2) Zillow Offers: Previously, Zillow directly participated in buying and selling homes through this program, although it is currently winding down. (3) Rentals Marketplace: Revenue is generated from property management companies and landlords who pay for advertising rental properties. (4) Mortgages: Zillow offers advertising and leads to mortgage lenders and receives fees for connecting them with potential borrowers. Additionally, Zillow earns from display advertising on its websites and mobile applications. Partnerships with real estate professionals and integration of various services also contribute to its financial growth.
Zillow Group Class A Financial Statement Overview
Summary
Zillow Group shows a mixed financial profile. Revenue growth is evident, but profitability remains a challenge with negative margins. The balance sheet is strong, with low debt levels and solid equity backing, while cash flow metrics indicate healthy liquidity despite past volatility.Income Statement
Zillow Group has displayed a volatile revenue trend, with a recent revenue growth of 14.95% from 2023 to 2024. However, the company is struggling with profitability, evidenced by a negative net profit margin of -5.01% and negative EBIT margin of -8.81% in 2024, indicating operational challenges.45
Neutral
Balance Sheet
The balance sheet is relatively strong with a low debt-to-equity ratio of 0.11, indicating conservative leveraging. The equity ratio stands at 83.18%, showing strong asset backing by shareholders. However, the company has shown losses in past years, impacting return on equity.65
Positive
Cash Flow
Cash flow analysis shows a positive operating cash flow to net income ratio of 3.82, suggesting healthy cash conversion despite net losses. Free cash flow has also grown, enhancing liquidity. However, previous volatility in cash flows poses potential risk.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.24B | 1.95B | 1.96B | 8.15B | 3.34B | Gross Profit |
| 1.71B | 1.52B | 1.59B | 1.75B | 1.58B | EBIT |
| -197.00M | -270.00M | -26.00M | -246.21M | 60.94M | EBITDA |
| 198.00M | 125.00M | 123.00M | 370.00M | 119.96M | Net Income Common Stockholders |
| -112.00M | -158.00M | -88.00M | -527.78M | -162.12M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.86B | 2.81B | 3.36B | 3.13B | 3.92B | Total Assets |
| 5.83B | 6.65B | 6.56B | 10.70B | 7.49B | Total Debt |
| 660.00M | 1.83B | 1.87B | 5.01B | 2.52B | Net Debt |
| -422.00M | 340.00M | 401.00M | 2.40B | 816.63M | Total Liabilities |
| 981.00M | 2.13B | 2.08B | 5.35B | 2.74B | Stockholders Equity |
| 4.85B | 4.53B | 4.48B | 5.34B | 4.74B |
| Cash Flow | Free Cash Flow | |||
| 285.00M | 189.00M | 4.36B | -3.28B | 315.68M | Operating Cash Flow |
| 428.00M | 354.00M | 4.50B | -3.18B | 424.20M | Investing Cash Flow |
| 395.00M | 25.00M | -1.53B | 1.09B | -1.04B | Financing Cash Flow |
| -1.23B | -352.00M | -4.34B | 3.15B | 1.16B |
Zillow Group Class A Technical Analysis
Negative
65.27
Price Trends
66.10
Negative
70.51
Negative
67.16
Negative
Market Momentum
-0.07
Positive
46.81
Neutral
12.10
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZG, the sentiment is Negative. The current price of 65.27 is below the 20-day moving average (MA) of 66.67, below the 50-day MA of 66.10, and below the 200-day MA of 67.16, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 46.81 is Neutral, neither overbought nor oversold. The STOCH value of 12.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ZG.
Zillow Group Class A Risk Analysis
Zillow Group Class A disclosed 49 risk factors in its most recent earnings report. Zillow Group Class A reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
The capped call transactions may affect the value of our Class C capital stock. Q4, 2024
2.
Our targets and disclosures related to ESG matters expose us to risks that could adversely affect our reputation and performance. Q4, 2024
3.
We are subject to multiple risks related to customer and partner payments. Q4, 2024
Zillow Group Class A Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $2.43B | 18.30 | 19.74% | ― | 5.93% | 29.17% | |
68 Neutral | $17.69B | ― | -0.39% | ― | 9.27% | 95.03% | |
66 Neutral | $3.08B | 87.40 | 7.98% | ― | 0.63% | 15.34% | |
65 Neutral | $15.66B | ― | -1.72% | ― | 14.96% | 49.24% | |
64 Neutral | $15.66B | ― | -1.72% | ― | 14.96% | 49.24% | |
60 Neutral | $14.12B | 6.43 | -3.57% | 3.69% | 2.49% | -35.43% | |
44 Neutral | $562.41M | ― | -18.77% | ― | 12.01% | 35.71% |
* Communication Services Sector Average
Performance Comparison
ZG
Zillow Group Class A
65.27
26.13
66.76%
YELP
Yelp
37.40
1.02
2.80%
TWLO
Twilio
113.49
54.44
92.19%
CARG
CarGurus
31.15
7.22
30.17%
Z
Zillow Group Class C
66.03
26.36
66.45%
KIND
Nextdoor Holdings
1.47
-1.01
-40.73%
Zillow Group Class A Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: -1.76%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
Zillow Group's Q1 earnings call highlighted strong financial performance, exceeding expectations with significant growth in rentals and mortgages. Despite challenges in the broader housing market, Zillow achieved GAAP profitability and continued to expand its Enhanced Markets. However, the company anticipates cost increases in Q2 related to seasonal marketing and new partnerships.Q1-2025 Updates
Positive Updates
Exceeding Q1 Outlook
Zillow exceeded their Q1 outlook, achieving strong top-line growth despite macroeconomic challenges. They achieved GAAP profitability and reported a 13% year-over-year revenue increase.
Significant Growth in Rentals Revenue
Rentals revenue increased by 33% year-over-year, reaching an all-time high of $129 million in Q1. Multifamily revenue grew by 47% in the quarter.
Expansion of Enhanced Markets
The share of connections within Enhanced Markets increased from 21% in Q4 to 24% in Q1, with expectations to reach more than 35% by the end of the year.
Positive GAAP Net Income
Zillow achieved a positive GAAP net income of $8 million for Q1, representing 1% of their revenue.
Strong Performance in Mortgages Revenue
Mortgages revenue was up 32% year-over-year to $41 million in Q1, driven by the growth of Zillow Home Loans.
Negative Updates
Challenges in the Housing Market
The high-end of the housing market was the main contributor to growth, while the rest of the market was largely flat year-over-year, impacting overall residential performance.
Cost Increases Expected in Q2
EBITDA expenses are expected to increase from $445 million in Q1 to an estimated $495 million in Q2, driven by seasonal marketing and costs associated with the Redfin Rentals partnership.
Company Guidance
During Zillow Group's First Quarter 2025 Financial Results Call, strong performance metrics were highlighted, including a 13% year-over-year revenue increase to $598 million, which surpassed their outlook by $15 million. The company achieved a GAAP profitability milestone, reporting $8 million in net income, driven by a $153 million adjusted EBITDA and a 26% EBITDA margin, marking a 200 basis point improvement. Zillow's For Sale category revenue rose 8% year-over-year, with Residential and Mortgages revenues increasing by 6% and 32%, respectively. Rentals revenue, reaching an all-time high of $129 million, grew by 33%, supported by a 47% growth in multifamily revenue. Zillow's Enhanced Markets strategy contributed to 24% of connections in Q1, expected to rise to over 35% by year-end. The company also reported 227 million average monthly unique users, with 80% of traffic being direct and organic. For full-year 2025, Zillow aims for low to mid-teens revenue growth, continued EBITDA margin expansion, and positive GAAP net income, with a focus on scaling its housing super app and enhancing its comprehensive Rentals marketplace.Zillow Group Class A Corporate Events
Private Placements and FinancingFinancial Disclosures
Zillow Group Settles Convertible Senior Notes Debt
Positive
May 16, 2025
On May 15, 2025, Zillow Group, Inc. fully settled its $419 million outstanding principal amount of 2.75% Convertible Senior Notes due 2025, rendering the company debt-free except for credit facility borrowings for Zillow Home Loans. The settlement involved cash payments totaling approximately $425 million and the issuance of 1,385 shares of Class C capital stock, marking a significant financial milestone for the company.
The most recent analyst rating on (ZG) stock is a Buy with a $95.00 price target. To see the full list of analyst forecasts on Zillow Group Class A stock, see the ZG Stock Forecast page.
Stock BuybackBusiness Operations and StrategyFinancial Disclosures
Zillow Group Authorizes $1 Billion Stock Buyback
Positive
May 7, 2025
On May 7, 2025, Zillow Group announced its Board of Directors authorized an additional $1 billion for stock repurchases, supplementing previous authorizations. The company reported strong financial results for Q1 2025, with revenue up 13% year over year to $598 million, driven by growth in various segments including Premier Agent offerings and rental services. Zillow’s strategic expansion and effective execution have positioned it for sustainable profitable growth, with increased traffic to its platforms and a positive outlook for the year.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.