Zillow (ZG) Stock Forecast & Price Target

Zillow Group Inc. demonstrated strong financial performance in Q4, with rentals revenue increasing by 25% year-over-year, driven by an expansion in multifamily property listings. For sale revenue saw a 15% year-over-year boost, while residential revenue growth reached approximately 11%, surpassing expectations. Additionally, the significant acceleration in mortgage revenue, driven by an 86% year-over-year increase, highlights the company's potential for further profitability, especially with a projected return to normalized transaction levels.

Zillow Group Inc. is facing a challenging outlook due to depressed inventory levels and transaction volume, particularly in its Premier Agent segment, which is expected to lead to significant slowing in its core residential business. The company has revised its EBITDA estimates to $125-140 million, falling 16.5% below consensus expectations, and is projecting only low single-digit to mid-single-digit residential revenue growth. Additionally, various risks, including rising interest rates, fluctuating home prices, and increased competition, further complicate the growth trajectory and profitability prospects for Zillow.