According to Keefe, Bruyette & Woods, Zillow Group Inc's
The Zillow Analyst: Analyst Ryan Tomasello initiated coverage with a Market Perform rating and price target of $80.
The Zillow Thesis: While the housing super app strategy aims to increase market coverage from 21% to a target of 75%, should support growth, "management's financial targets appear aggressive at this early stage," Tomasello said in the initiation note.
"On the other hand, we are bullish on Zillow's ability to increase take rates in areas like its direct-to-consumer mortgage strategy, Zillow Home Loans," the analyst wrote. The strategy has the potential "to drive meaningful gains," he added.
Zillow has a mixed track record of monetizing this large audience. As for the housing super app strategy, scalability remains "a show-me story," Tomasello said.
"On the macro front, weak home sales remain a drag on Zillow's business, where the recovery timeline is uncertain," he further wrote.
Zillow competes with well-capitalized competitors, including News Corp's
Price Action: At the time of publication on Friday, shares of Zillow had declined by 2.20% to $68.80.
