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Where Is Zillow (Z) Headed?

|Includes: Zillow Group, Inc. (Z)

Zillow (NASDAQ:Z) has been on fire as of late, with the stock up nearly $20over the past 5 sessions. It was also one of the few growth/momentum names to hold up relatively well during the momo madness firesale over the couple of weeks. Why? Well the housing market continues to do well, rates are holding tight, and the amount of folks using Zillow has grown over 50% since this time last year(76 million compared to 50 million)

I wrote about Zillow(Z) back in August, and thought it was going to be the monster stock of 2013. Well it now looks like it's trying to be the monster stock of 2014 as well. Despite the stock being up over 30% so far this year, I think it still has plenty of upside left. Folks are continuing to bet against the story, with the short interest at an all-time high of 31.4% with 7.7 million shares sold short. That alone should add some fuel to the fire.

Stocks like Zillow((Z) are extremely hard to value, and can have large swings in both directions, which are the type that an option trader like myself love. Of course I am betting on the call side, and think Zillow(Z) can near $120 in the coming weeks.

I currently hold $Z $115 calls and may add or sell my position at any time. Happy Trading!

- JB

Disclosure: I am long Z.