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Zillow Group, Inc. (Z)

  • Wed, Nov. 4, 9:15 AM
    | Wed, Nov. 4, 9:15 AM | 2 Comments
  • Tue, Nov. 3, 5:31 PM
    • Zillow's (Z, ZG) Q3 EPS of $0.07 beat a -$0.03 consensus, and revenue of $176.8M slightly beat a $176.5M consensus. However, the company has guided on its earnings call for Q4 revenue of $165M-$170M, below a $179.1M consensus. Q4 adjusted EBITDA is expected to total $20M-$25M, down from Q3's $29.5M.
    • Zillow notes Q4 guidance doesn't include revenue from Market Leader, whose sale was closed at the end of September. Some Q4 analyst estimates might not have been adjusted to account for the sale.
    • The online real estate leader does expect 2016 revenue growth to exceed 2015's rate. For the first 9 months of 2015, Zillow's pro forma revenue (adjusts for the Trulia deal) is up 22% Y/Y.
    • Top-line performance: Marketplace revenue rose 22% Y/Y in Q3 to $153.2M, while display revenue (ads, hurt by weak industry demand) fell 23% to $30.4M. The display decline is attributed to "continued strategic efforts to reduce display advertising on the company's mobile applications and websites to further promote our Marketplace products."
    • Metrics: Agent advertisers fell to 96,965 at the end of Q3 from 101,297 at the end of Q2. Zillow previously stated it's now de-emphasizing agent count, and instead focusing on growing revenue via high-ARPA agents. Monthly unique users averaged 142.1M, up slightly from Q2's 141M.
    • Z -7.5% after hours to $27.30. ZG -9.3% to $28.10.
    • Q3 results, PR
    • Update (6:39PM ET): Zillow tells Seeking Alpha it had found only a small number of Q4 analyst estimates had accounted for the Market Leader sale. Both Z and ZG remain down over 7%.
    | Tue, Nov. 3, 5:31 PM | 17 Comments
  • Tue, Nov. 3, 4:33 PM
    • Zillow (NASDAQ:Z): Q3 EPS of $0.07
    • Revenue of $176.77M (+99.4% Y/Y)
    • Shares +6.44%.
    • Press Release
    | Tue, Nov. 3, 4:33 PM | Comment!
  • Wed, Oct. 21, 11:00 AM
    • Guggenheim Securities has downgraded Zillow (Z -3.5%, ZG -2.9%) to Neutral ahead of its Nov. 3. Q3 report.
    • Both Zillow's Class A and C shares have soundly outperformed the Nasdaq over the last two months. The A shares were performing very differently earlier this year.
    | Wed, Oct. 21, 11:00 AM | 11 Comments
  • Thu, Oct. 8, 2:17 PM
    • Zillow's (ZG +7.4%) Class A shares and (to a lesser extent) its non-voting Class C (Z +3.9%) shares are up strongly on a day the Nasdaq is down 0.6%. The A and C shares are now respectively up 59% and 36% from their 52-week lows.
    • No major news has arrives. Zillow did announce this morning over 2/3 of Zillow and Trulia agent listings now stem from direct deals with multiple listing services (MLSs). The company has been busy striking MLS deals this year, in part to offset the termination of Zillow/Trulia's deals with ListHub.
    | Thu, Oct. 8, 2:17 PM | 18 Comments
  • Mon, Aug. 24, 9:19 AM
    | Mon, Aug. 24, 9:19 AM | 14 Comments
  • Wed, Aug. 5, 9:19 AM
    | Wed, Aug. 5, 9:19 AM | 11 Comments
  • Tue, Aug. 4, 5:38 PM
    | Tue, Aug. 4, 5:38 PM | 9 Comments
  • Tue, Aug. 4, 5:34 PM
    • Low expectations have helped Zillow (NASDAQ:Z) jump to $79.80 following its Q2 beat. Shares were down 30% YTD going into earnings.
    • On its earnings call, the company has reiterated 2015 revenue guidance of $690M (above a $666.5M consensus). Adjusted EBITDA guidance has been hiked by $5M to $85M-$90M. Q3 revenue guidance is nonetheless at $175M-$177M, below a $180.9M consensus.
    • Pro forma revenue growth (accounts for the Trulia merger) was 20% in Q2, a slowdown from Q1's 35%. Marketplace revenue rose 29% to $145.5M, while display revenue (hurt by a weak display ad market, ask LinkedIn and Yelp) fell 15% to $25.8M.
    • With Marketplace, real estate revenue rose 37% to $122.6M, mortgage revenue rose 44% to $10.4M, and Market Leader (real estate CRM software) fell 21% to $12.5M. Zillow reiterates it's "conducting a strategic review" for Market Leader.
    • Advertisers/ARPA: The company had 101,297 agent advertisers at the end of Q2, down 2,118 Q/Q. On the other hand, average monthly revenue per advertiser (ARPA) rose to $375 from $354 in Q1 and $318 a year ago. Zillow notes it "strategically ended several of Trulia's short-term discounted products and changed the sales team's incentives to focus on net revenue rather than the number of advertisers." The company adds it's focusing on "high ARPA agents who provide a superior consumer experience."
    • GAAP sales/marketing spend equaled 51.3% of revenue, R&D 30%, and G&A 26%. Gross margin was 90%. Average monthly unique users totaled 141M. Zillow claims a 72% share of U.S. mobile exclusive real estate visitors (per comScore).
    • Q2 results, PR
    • Update (7:25PM ET): Zillow is now up 14.5% AH.
    | Tue, Aug. 4, 5:34 PM | 7 Comments
  • Tue, Aug. 4, 4:32 PM
    • Zillow (NASDAQ:Z): Q2 EPS of -$0.01 beats by $0.25.
    • Revenue of $171.27M (+117.7% Y/Y) beats by $2.58M.
    • Shares +2.5%.
    • Press Release
    | Tue, Aug. 4, 4:32 PM | 21 Comments
  • Mon, Aug. 3, 4:47 PM
    • Kathleen Philips, Zillow's (NASDAQ:Z) COO since 2013, is the company's new CFO. Amy Bohutinsky, Zillow's chief marketing officer for the last 4 years, is the new COO. Both will continue reporting to CEO Spencer Rascoff.
    • Zillow announced on July 9 CFO Chad Cohen is leaving to "pursue other business interests." Q2 results arrive tomorrow afternoon.
    | Mon, Aug. 3, 4:47 PM | 9 Comments
  • Fri, Jul. 31, 9:29 AM
    • Cowen has downgraded Zillow (NASDAQ:Z) to Underperform ahead of Tuesday afternoon's Q2 report. Like others, the firm is worried about slowing subscriber and traffic growth. It also cites concerns about valuation and meeting 2016 expectations.
    • Shares have fallen to $81.00 premarket, and are now down 24% YTD. Barclays downgraded to Underweight on July 20, while Morgan Stanley launched at Overweight on July 14.
    | Fri, Jul. 31, 9:29 AM | Comment!
  • Fri, Jul. 24, 1:59 PM
    • Nearly 3 years after originally taking aim at Zillow (NASDAQ:Z), Citron Research has published a list (.pdf) of "Top 10 reasons why Zillow is going to trade below $40 next year."
    • Among Citron's arguments: The pending departure of CFO Chad Cohen; $13.7M worth of stock sales by CEO Spencer Rascoff over the last 12 months; Web scraping data that suggests Zillow/Trulia are collectively losing real estate agents; and a belief the company "can never be acquired at its current share price."
    • Of note: While Zillow has fallen considerably from a July 2014 high of $164.90 (hit amid Trulia merger euphoria), shares are still well above where they closed ($44.41) the day before Citron's original report. Q2 results arrive on Aug. 4.
    | Fri, Jul. 24, 1:59 PM | 28 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
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.