Is Zillow Inc About to be Zapped?


About Zillow

Zillow (Z) is a Seattle, Washington based American online real-estate marketplace that allows homeowners, home buyers, renters, real estate agents, property managers and landlords, and mortgage professionals to search for information regarding all things real-estate.

Zillow in the News

With summer just around the corner, many people are looking to rent out their homes, as well as find homes to rent and Zillow Inc (NASDAQ:Z) is ready to assist.

However, Shares of Zillow Inc (NASDAQ:Z) fell almost 4% yesterday, June 2 after RBC Capital analyst Mark Mahaney and Pacific Crest analyst Chad Bartley downgraded their ratings for the company from outperform to sector perform.

What Does This Mean for Zillow’s Stock?

RBC Capital analyst Mark Mahaney downgraded Zillow from outperform to sector perform with a $115 price target. Mahaney explained, “Given the steady improvement we have tracked with Z’s fundamentals, we believe this outperformance has been justified. However, with the stock now trading at 48X ’15 EV/EBITDA and 12X ’15 EV/Sales — among the highest multiples in the sector — we see valuation upside as limited from here.” Mahaney has a +11.0% average return and a 62% success rate according to TipRanks. He also has a +15.8% average return on Zillow.

Pacific Crest analyst Chad Bartley also downgraded the stock from outperform to sector perform. He reasoned, “We do not see a negative catalyst for Zillow Inc (NASDAQ:Z) shares and would encourage investors to maintain exposure, but we think it makes sense to take some profits given the strong outperformance, already high multiple and limited upside.” Bartley has a +10.0% average return and a 65% success rate. He also has a +26.2% average return recommending Zillow.


Zillow Inc (NASDAQ:Z) has historically been a strong stock, but not all financial experts think that now is the time to add more shares to their portfolio.

By Carly Forster 

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About the Author

TipRanks was founded in 2012 with the goal of giving power back to the individual investor. Our hope is that by making analyst performance data easily available and highly visible to the investing public, TipRanks will not just help save others from our investing mistakes, but will also bring back accountability, objectivity, and transparency to the business of stock picking and analyst reports. TipRanks is proudly unaffiliated with any investment firm.

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