Z - Zillow Earnings: Balancing Promises And Valuation

2024-02-14 07:10:47 ET

Summary

• Zillow's Q4 results showed promising growth in residential revenue and success in the rental and mortgage markets.
• The company's near-term prospects appear positive, but it faces challenges in navigating the evolving regulatory landscape and operational complexities.
• Zillow's revenue growth rates for 2024 are projected to reach 10% CAGR, but the stock's valuation at 29x forward EBITDA is considered high.

Investment Thesis

Zillow (Z) delivered Q4 2023 results that took investors by surprise. There's no doubt that Zillow is finally on the cusp of turning around its prospects. The only problem here is that paying close to 29x forward EBITDA for Zillow doesn't leave investors with a lot of upside on the stock....

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