Zillow (ZG) Stock Forecast & Price Target

Zillow Group Inc. has demonstrated significant growth potential, with 44% of connections now originating from Enhanced Markets, a notable increase from 34% last quarter and 21% year-over-year. The Zillow Rentals marketplace has expanded to 2.5 million active listings, reflecting consistent growth from the previous quarters, while reported EBITDA of $149 million signifies a 33% year-over-year increase, aligned with management's guidance. Additionally, expectations for healthy margin expansion in fiscal years 2024 and 2025, driven by effective cost management strategies, further bolster the company's positive financial outlook.

Zillow Group Inc. reported fourth-quarter revenue of $654 million, which was 1% above previous forecasts; however, EBITDA fell short by 1% due to an increase in legal expenses, which negatively impacted EBITDA margins. Guiding into the first quarter, the company anticipates a further margin drag linked to ongoing legal costs, and looking towards fiscal year 2026, additional headwinds are expected, contributing to a generally pessimistic outlook. Key risks include potential long-term depression in the real estate industry stemming from limited supply, possible shifts in the commission structure affecting revenue, and increasing competition that may diminish Zillow's market position.