Susquehanna Raises Price Target on Zillow Group, Inc. (ZG) Following 2Q Beat

Susquehanna reiterated a Neutral rating on Zillow Group (NASDAQ: ZG), and raised the price target to $35.00 (from $30.00), following the company's 2Q earnings report. following the company's 2Q earnings report. Zillow reported revenue ~$2.9m above consensus, driven by higher rental and other revenue. Upside catalysts include ARPA growth and traffic trends.

Analyst Shyam
Patil commented, "While we like the company’s longterm ability to capture a growing portion of agent marketing spend, we are maintaining our Neutral due to: 1) the valuation (~8x EV/sales, which is the third highest in our group); 2) large step up in implied 2H spending without any expected benefit for revenue or lead growth…or said another way, the implied 2H EBITDA guide down is ~18%, while revenue expectations are unchanged; and 3) the sudden change in the company’s auditor. Upcoming catalysts include third-party traffic data for Zillow/Trulia and quarterly results."

For an analyst ratings summary and ratings history on Zillow Group click here. For more ratings news on Zillow Group click here.

Shares of Zillow Group closed at $39.35 yesterday.

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