Zillow’s Raised Outlook and Buybacks Could Be a Game Changer for Zillow Group (ZG)

• Zillow Group recently reported second quarter results with a return to profitability, sales of US$641 million, and raised its full-year 2025 revenue growth expectations to the higher end of its previous outlook.
• The company also completed another tranche of its buyback program, repurchasing over 2.3 million shares in the last quarter, indicating ongoing shareholder-focused initiatives.
• We'll explore how Zillow's raised full-year revenue guidance could shift the company's investment narrative and future expectations.

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Zillow Group Investment Narrative Recap

To own Zillow Group stock, you need to believe in the continued digital transformation of real estate and Zillow’s ability to capitalize on this trend through product innovation, user engagement, and expanded monetization of its platform. The company’s upgraded 2025 revenue outlook and recent profitability do offer some support for bullish sentiment, but near-term results don’t significantly shift the largest catalyst or address the main risk, sustained weakness in housing transaction volumes and ongoing regulatory uncertainty around real estate commissions.

One of the most relevant announcements is Zillow’s raised full-year 2025 revenue guidance, now at the higher end of its prior outlook, with third quarter projections pointing to 14% to 16% growth year over year. This aligns with the narrative of accelerating digital adoption in the sector but leaves Zillow exposed to macro factors influencing transaction activity and agent spending, which remain outside its direct control.

However, investors should be mindful that even with a positive outlook, persistent low home affordability and regulatory headwinds around agent commissions could still...

Read the full narrative on Zillow Group (it's free!)

Zillow Group’s narrative projects $3.6 billion in revenue and $425.1 million in earnings by 2028. This requires a 14.8% annual revenue growth rate and an increase in earnings of $487.1 million from the current -$62.0 million.

Uncover how Zillow Group's forecasts yield a $86.52 fair value, a 12% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members have set fair value targets for Zillow Group ranging from US$25.79 to US$95.82, across seven individual analyses. With management’s outlook upgrade and improved earnings, your view on housing market risk may shape how you interpret this broad spread.

Explore 7 other fair value estimates on Zillow Group - why the stock might be worth less than half the current price!

Build Your Own Zillow Group Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Zillow Group research is our analysis highlighting 2 key rewards that could impact your investment decision.
• Our free Zillow Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Zillow Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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