UPDATE: Zillow (Z) PT Raised to $161 at Morgan Stanley on Increased Transactions and Asset Light Model

February 11, 2021 3:34 AM EST
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Price: $145.11 -1.09%

Rating Summary:
    14 Buy, 11 Hold, 2 Sell

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    Up: 17 | Down: 14 | New: 42
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(Updated - February 11, 2021 7:22 AM EST)

Morgan Stanley analyst Brian Nowak raised the price target on Zillow (NASDAQ: Z) to $161.00 (from $148.00) after Homes also shows its first quarter of positive unit economics at scale while 2020 showed the profitability Z's asset-light marketplace can generate.

The analyst reiterated an Equalweight rating, stating "Greater velocity implies a larger pool of home transactions and gives Zillow’s agents more incentive and ability (commissions) to bid on impressions in their ad auction market…as we continue to see the faster housing market recovery leading to faster premier agent ad revenue growth as our housing estimates imply ’21 home sales are ~14% above 2019 levels. However, that could grow faster if the market follows Z's economics forecast of 21% existing home sales growth in '21. Zillow also announced the acquisition of ShowingTime for $500M in cash, an industry-leading real estate showing software provider that facilitated more than 50M in-person home tours in 2020. Adding ShowingTime to Z's suite of real estate technology solutions gives it the opportunity to accelerate a widely-adopted solution for the complexity of tour scheduling... adding to Z's industry-leading moats."


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