To say that the real estate market has been embedded in chaos for the last three years would probably not be that out of line. That’s made things tough on Zillow (NASDAQ:Z) (NASDAQ:ZG), among others, but there are some signs that Zillow’s making a comeback. In fact, it’s up fractionally with Monday afternoon’s trading, largely thanks to a fresh look from Bernstein.
Bernstein analysts upgraded Zillow from “underperform” to “market perform,” noting that Zillow’s key market segments may have finally hit bottom. Both IMT and Premier Agent segments are on an upswing, and that’s largely corresponding to comps “…easing up” in recent real estate sales. Further, earnings and revenue estimates on Zillow have already seen significant cuts in the past year.
Certainly, Zillow isn’t out of danger just yet, with a souring macroeconomic picture and an overall market still heavily divided between high prices and everybody else. But the Bernstein analysts do suggest that Zillow is perhaps in a better place since it’s already taken measures to protect itself. Further, significantly diminished expectations of Zillow’s performance are much easier to meet, or even exceed, than higher ones, which should give Zillow a leg up.
Currently, analysts are split on Zillow. Two Buy ratings and three Holds make Zillow stock a Moderate Buy. Further, with an average price target of $49.33, Zillow stock offers investors an upside potential of 12.83%.
