Jefferies expects pressure on Zillow multiple after NAR settlement

Jefferies analyst John Colantuoni notes the National Association of Realtors, or NAR, reached a settlement agreement to pay $418M over four years and adjust certain commission practices. The agreement prohibits communication of compensation on the Multiple Listing Service, or MLS, which could reduce commissions for buyer agents over time, noted the analyst. Practical implications to Zillow fundamentals “could be limited in the near-term,” but the firm would expect pressure on the stock’s multiple given the downside risk to terminal earnings potential, says the analyst, who has a Buy rating and $75 price target on Zillow shares.