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Zillow Group, Inc. (Z)

  • Tue, Jul. 21, 9:54 PM
    • Echoes of Google: Zillow's (NASDAQ:Z) board has approved the creation of Class C shares that carry no voting rights. On Aug. 14, Zillow will distribute two Class C shares for each Class A and Class B share owned by shareholders.
    • After the distribution, Class C shares will trade under the symbol Z, and Class A shares under the symbol ZG. Co-founders Rich Barton and Lloyd Frink are the sole holders of Class B shares, which carry 10x the voting rights of Class A shares
    • The move aims to further protect Barton/Frink and management from having to worry about shareholder revolts when making big decisions. Zillow, for its part, argues its action will enable the company to "continue its focus on long-term growth and innovation."
    | Tue, Jul. 21, 9:54 PM | 6 Comments
  • Mon, Jul. 20, 9:28 AM
    • Believing online local services competition is growing, Barclays' Chris Merwin has downgraded YELP to Equal Weight, and Zillow (NASDAQ:Z) to Underweight. His targets have respectively been cut to $36 and $70 and from $50 and $90.
    • Merwin: "VC-funded startups are able to undercut larger players on price or outspend on marketing, without the scrutiny of public investors ... Heading into earnings, we favor lower multiple names that we believe are at the beginning (or in the midst) of a positive earnings revision cycle, rather than challenged stocks with ostensibly 'cheap' multiples relative to consensus growth estimates that are probably too high," Both Yelp and Zillow have fended off a number of well-financed rivals over their histories.
    • He notes Yelp and Zillow have each seen traffic growth slow considerably, with Yelp's Q1 monthly unique visitors only up 8% Y/Y. Merwin argues each company needs to up its marketing spend to boost traffic, and believes the spending needed by Zillow isn't factored into consensus estimates.
    • Merwin also issued a downbeat note on Zillow on July 10, following news CFO Chad Cohen is resigning. Morgan Stanley launched at Overweight a few days later.
    • YELP -3.4% premarket to $33.79. Z -2.4% to $81.27. Yelp's Q2 report is due on July 28. Zillow is expected to report prior to Cohen's resignation date (Aug. 7).
    | Mon, Jul. 20, 9:28 AM | 1 Comment
  • Tue, Jul. 14, 10:14 AM
    • Believing the company is expanding its addressable market by "shifting broker economics to advertising," Morgan Stanley's Dean Prissman has launched coverage on Zillow (NASDAQ:Z) with an Overweight rating and $108 target.
    • Prissman: "Low volume agents can’t afford to participate on Zillow. But since Zillow is gaining share of transactions, this is enabling more successful agents to take share from less successful agents. Since more successful agents have higher commission retention rates and invest more in advertising, Zillow is driving industry economics to advertising."
    • He adds the bottom 75% of agents account for only 40% of transactions and 16% of ad budgets. The launch comes 4 days after shares fell sharply on news CFO Chad Cohen is resigning.
    | Tue, Jul. 14, 10:14 AM | 3 Comments
  • Fri, Jul. 10, 5:50 PM
    • "[W]e believe the timing of the CFO change is less than ideal, as Zillow (NASDAQ:Z) continues to navigate through its merger with Trulia, which we believe has so far led to disruption in both agent and traffic growth," writes Barclays' Chris Merwin (Equal Weight, $90 target) following news of CFO Chad Cohen's pending departure.
    • Merwin adds Trulia's agent sub growth has been hurt by salesforce departures and slowing traffic growth, and that management's decision to de-emphasize the Market Leader real estate CRM software platform (previous) is "another source of disruption to revenue."
    • He predicts integration pains will continue to weigh on Zillow's results in 2H15. Though Zillow didn't affirm/update Q2 guidance, Merwin's Q2 outlook is unchanged. However, he only forecasts Q3 and Q4 Y/Y sales growth of 15% and 14% - a sharp slowdown from Q4 2014's 47% - and thinks the company may once more need to up marketing spend.
    • SunTrust's Bob Peck (Buy, $130 target) is more positive, calling Cohen's departure a "minor disruption" and deeming it unlikely that he was fired or left due to accounting issues. He's still "comfortable" with a full-year sales estimate of $685M (above a $664.5M consensus).
    • Shares fell to new 52-week lows today. They now trade for 4.8x 2016E sales, after backing out cash/investments.
    | Fri, Jul. 10, 5:50 PM | 13 Comments
  • Thu, Jul. 9, 5:40 PM
    • Top gainers, as of 5.25 p.m.: GCI +4.5%. SBS +2.2%. CHMT +2.2%. UDF +2.2%. SOHU +1.9%.
    • Top losers, as of 5.25 p.m.: Z -5%. HALO -4.7%. HELE -4.6%. DOV -3.9%. AQXP -2.4%.
    | Thu, Jul. 9, 5:40 PM | 1 Comment
  • Thu, Jul. 9, 4:42 PM
    • Chad Cohen, Zillow's (NASDAQ:Z) CFO since 2011, is resigning to "pursue other business interests," effective Aug. 7. The company has begun a search for a new CFO.
    • Shares have fallen to $82.00 AH. The fact Zillow didn't use its announcement to reaffirm guidance (as if often done when a C-suite change is announced ahead of earnings) could be weighing.
    | Thu, Jul. 9, 4:42 PM | 9 Comments
  • Fri, Jun. 19, 12:32 PM
    • Like Twitter, Zillow (NASDAQ:Z) is getting a lift from vague market chatter that it's a buyout target. 1.45M shares have been traded thus far vs. a 3-month daily average of 1.78M.
    • Friday short-covering could be helping out: 16.8M shares (32% of the float) were shorted as of May 29.
    • Oppenheimer's Jason Helfstein (Perform rating) issued a cautious note on Tuesday, arguing slowing traffic growth could put 2016 Street estimates at risk. "Per comScore, [U.S.] 2Q minutes are trending +3% y/y vs. +5% in 1Q and +30% in 4Q. To combat lower traffic, [management] will likely need to increase advertising, or test new products, at the expense of margin."
    | Fri, Jun. 19, 12:32 PM | 1 Comment
  • Tue, May 12, 5:44 PM
    • After coming off a halt, Zillow (NASDAQ:Z) is up 1.8% AH in the wake of its Q1 report. In spite of a Q1 revenue miss, the company is reiterating full-year revenue and adjusted EBITDA guidance of $690M and $80M-$85M (provided on April 14).
    • The Market Leader real estate CRM software unit (acquired by Trulia in 2013) was a weak spot in Q1: Its sales fell 11% Y/Y to $13.6M. Display ad sales were also light, rising only 5% on a pro forma basis (i.e. counting both Zillow and Trulia's full numbers) to $25.6M. Yelp, LinkedIn, and others have reported soft Q1 display ad sales, while often blaming industry adoption of programmatic (automated) ad-buying platforms that have depressed prices.
    • Core real estate services revenue was stronger, rising 54% to $113.4M. Mortgage services revenue rose 33% to $10M.
    • Business metrics: Zillow had 103,415 Premier Agent advertisers at the end of Q1 - that figure includes Trulia agents. Premier Agent ARPA was $354; it was $359 for Zillow proper in Q4. Following the end of the ListHub deal, Zillow says it now receives 100% of real estate listings directly. March unique visitors totaled nearly 140M, and close to 2/3 of Zillow brand usage now occurs on mobile.
    • Pro forma adjusted EBITDA more than doubled Y/Y to $24.5M. $12.5M worth of acquisition costs were recorded, as were $25.1M worth of restructuring costs - Zillow/Trulia announced job cuts after their merger closed in February.
    • Q1 results, PR
    | Tue, May 12, 5:44 PM | 4 Comments
  • Tue, May 12, 4:32 PM
    • Zillow (NASDAQ:Z): Q1 EPS of $0.05 beats by $0.17.
    • Revenue of $127.7M (+92.8% Y/Y) misses by $7.97M.
    • Shares are halted.
    • Press Release
    | Tue, May 12, 4:32 PM | 32 Comments
  • Tue, May 12, 4:05 PM
    • Zillow (NASDAQ:Z) has been halted ahead of this afternoon's Q1 report.
    | Tue, May 12, 4:05 PM | Comment!
  • Mon, May 11, 5:35 PM
  • Mon, May 11, 10:35 AM
    • SunTrust's Bob Peck has upgraded Zillow (NASDAQ:Z) to Buy ahead of tomorrow's Q1 report, and hiked his target by $20 to $130.
    • Among the positives cited by Peck: A large and growing online real estate market; rising mobile usage; Zillow's network effect; strong ROIs for real estate agents; margin leverage (Peck thinks 45%+ op. margins are possible); and the optionality provided by adjacent opportunities.
    • He also dismisses concerns about Zillow's dependence on 3rd-party listings data, competition from News Corp./, and the size of Zillow's addressable agent pool. "At ~55% penetration of the top 350K agents (or ~200K) Zillow could generate ~$4B in agent revenues."
    • Zillow rallied last month after providing below-consensus 2015 guidance amid low expectations. Two weeks ago, Peck downgraded Twitter just before the company posted a Q1 sales miss and cut its full-year guidance (and crashed in response).
    | Mon, May 11, 10:35 AM | Comment!
  • Mon, Apr. 27, 3:06 PM
    • Today's notable tech gainers include online real estate leader Zillow (Z +4.3%), online travel deals platform Travelzoo (TZOO +8%), and gaming IP licensing firm Worlds (OTCQB:WDDD +15.5%).
    • Notable decliners include wireless charging tech developer Energous (WATT -9.3%), enterprise mobility management software firm MobileIron (MOBL -9.4%), Chinese mobile game publisher iDreamSky (DSKY -7.1%), and cloud tech support software provider (SPRT -6.6%). The Nasdaq is down 0.6%.
    • Zillow is now up 10% since providing soft full-year guidance on April 14. Travelzoo is up 32% since posting a Q4 beat on April 16.
    • Energous is selling off after filing a $75M mixed shelf following Friday's close. MobileIron is down 34% since issuing a Q1 warning last Wednesday. iDreamSky is missing out on a Chinese tech rally.
    • Previously covered: Applied Materials, Aerohive, Taser, Oclaro,, Sky-mobi, 3D Systems/Stratasys
    | Mon, Apr. 27, 3:06 PM | 1 Comment
  • Tue, Apr. 14, 10:03 AM
    • Zillow (NASDAQ:Z) has fallen to new 52-week lows after providing light 2015 revenue guidance on its CC, and forecasting full-year adjusted EBITDA of just $80M-$85M. However, shares have quickly bounced from a low of $81.07.
    • Zillow also stated on the CC 2015 will be a "transition year," and suggested Premier Agent net adds will be light. Shares trade for 6.9x Zillow's 2015 revenue forecast.
    • Update (1:50PM ET): Zillow is now only down 1.9%.
    | Tue, Apr. 14, 10:03 AM | 8 Comments
  • Tue, Apr. 14, 9:13 AM
    • Zillow (NASDAQ:Z) guides on this morning's CC (webcast) for 2015 revenue of $690M, below a $753M consensus.
    • Shares are halted. Barclays downgraded on April 6, and Cowen cut its target on March 31.
    • Yesterday: Zillow higher after scheduling CC
    | Tue, Apr. 14, 9:13 AM | 3 Comments
  • Mon, Apr. 13, 6:35 PM
    • Zillow (NASDAQ:Z) has scheduled a conference call for 9AM ET tomorrow (webcast). The online real estate giant will use it to provide "an operational progress report" on the Trulia deal, and to "discuss its preliminary full-year pro forma outlook for 2015."
    • Shares have risen to $95.15 AH. They fell 4.8% in regular trading ahead of the announcement.
    | Mon, Apr. 13, 6:35 PM | 4 Comments
Company Description
Zillow Group Inc operates the real estate and home-related information marketplaces on mobile and the Web, with a complementary portfolio of brands and products to help people find vital information about homes and connect with local professionals.