Zillow Group (NASDAQ:ZG) Shares Gap Down After Analyst Downgrade

Key Points

• Zillow shares fell 11.9%, opening at $31.12 after DA Davidson cut its price target from $60 to $50, although it maintained a “buy” rating.
• Analyst sentiment remains mixed: Zillow has a consensus “hold” rating, with an average price target of $58.86; Susquehanna also downgraded the stock to “neutral” and lowered its target to $38.
• Zillow beat second-quarter earnings and revenue estimates, but reported a $4 million net loss, announced more than 500 job cuts and issued below-consensus third-quarter revenue guidance, raising concerns about near-term momentum.

Zillow Group, Inc. (NASDAQ:ZG - Get Free Report) gapped down prior to trading on Thursday after DA Davidson lowered their price target on the stock from $60.00 to $50.00. The stock had previously closed at $36.89, but opened at $31.12. DA Davidson currently has a buy rating on the stock. Zillow Group shares last traded at $31.5530, with a volume of 485,665 shares.

Several other research analysts have also recently weighed in on ZG. Weiss Ratings cut shares of Zillow Group from a "sell (d+)" rating to a "sell (d)" rating in a report on Friday, May 22nd. UBS Group reduced their target price on Zillow Group from $75.00 to $50.00 and set a "buy" rating for the company in a report on Friday, July 31st. Citigroup reiterated a "buy" rating on shares of Zillow Group in a report on Thursday. Royal Bank Of Canada reissued an "outperform" rating and issued a $55.00 price objective on shares of Zillow Group in a research report on Thursday. Finally, Susquehanna reduced their price objective on Zillow Group from $50.00 to $38.00 and set a "neutral" rating for the company in a research note on Thursday. Eleven investment analysts have rated the stock with a Buy rating, fourteen have assigned a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, the company has a consensus rating of "Hold" and an average target price of $58.86.

Insider Transactions at Zillow Group

In related news, General Counsel Bradley D. Owens sold 3,364 shares of Zillow Group stock in a transaction dated Friday, May 15th. The stock was sold at an average price of $37.23, for a total value of $125,241.72. Following the completion of the sale, the general counsel owned 65,245 shares of the company's stock, valued at approximately $2,429,071.35. This trade represents a 4.90% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Dan Spaulding sold 3,078 shares of the business's stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $37.40, for a total value of $115,117.20. Following the completion of the sale, the insider owned 49,696 shares in the company, valued at $1,858,630.40. This represents a 5.83% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 42,910 shares of company stock valued at $1,605,732. 29.88% of the stock is currently owned by insiders.

Key Zillow Group News

Here are the key news stories impacting Zillow Group this week:

• Positive Sentiment: Zillow reported second-quarter adjusted EPS of $0.52, above the $0.44 consensus estimate, while revenue rose 17.9% year over year to $772 million, exceeding expectations of $758.25 million. Zillow Group Beats Q2 Earnings and Revenue Estimates
• Positive Sentiment: DA Davidson maintained a “buy” rating while lowering its price target from $60 to $50, implying substantial upside from the current quotation. Benzinga analyst coverage
• Neutral Sentiment: July home sales increased 7% year over year, the strongest annual gain of 2026; however, sharply lower newly pending sales and higher mortgage rates suggest housing activity could weaken during the second half. Zillow July Market Report
• Neutral Sentiment: Susquehanna cut its price target from $50 to $38 and shifted to a “neutral” rating, while KeyBanc reportedly retained its “buy” recommendation. Benzinga analyst coverage
• Negative Sentiment: Zillow posted a $4 million net loss as $36 million of restructuring costs weighed on results, despite the adjusted earnings beat. The company also cut more than 500 jobs, or approximately 7% of its workforce, adding concerns about operating momentum and execution. Zillow Swings to Loss on Restructuring Costs
• Negative Sentiment: Third-quarter revenue guidance of $745 million-$760 million was below the $772.3 million consensus estimate, while full-year guidance of $2.9 billion-$3.0 billion was at or below expectations. Cantor Fitzgerald lowered its target from $34 to $32 with a “neutral” rating, and Zacks Research downgraded the stock from “strong buy” to “hold.” Benzinga and Zacks analyst coverage
• Negative Sentiment: Multiple law firms are promoting a securities-fraud class action with an August 10 lead-plaintiff deadline, creating an additional headline and potential legal risk for investors. Zillow Securities Class Action Notice

Institutional Trading of Zillow Group

Institutional investors have recently modified their holdings of the business. Arax Advisory Partners raised its holdings in Zillow Group by 402.3% during the 4th quarter. Arax Advisory Partners now owns 442 shares of the technology company's stock valued at $30,000 after acquiring an additional 354 shares during the period. First Command Advisory Services Inc. bought a new stake in shares of Zillow Group during the 4th quarter valued at $34,000. EverSource Wealth Advisors LLC lifted its holdings in Zillow Group by 183.6% during the 1st quarter. EverSource Wealth Advisors LLC now owns 984 shares of the technology company's stock worth $41,000 after purchasing an additional 637 shares in the last quarter. Fifth Third Bancorp boosted its stake in Zillow Group by 990.3% in the 1st quarter. Fifth Third Bancorp now owns 1,014 shares of the technology company's stock worth $42,000 after purchasing an additional 921 shares during the period. Finally, Kestra Advisory Services LLC purchased a new position in Zillow Group during the 4th quarter valued at about $47,000. 20.32% of the stock is currently owned by hedge funds and other institutional investors.

Zillow Group Trading Down 11.9%

The stock has a fifty day simple moving average of $33.23 and a two-hundred day simple moving average of $41.83. The firm has a market cap of $7.43 billion, a PE ratio of 128.33, a price-to-earnings-growth ratio of 1.58 and a beta of 1.95.

Zillow Group (NASDAQ:ZG - Get Free Report) last released its quarterly earnings data on Wednesday, August 5th. The technology company reported $0.52 EPS for the quarter, beating analysts' consensus estimates of $0.44 by $0.08. The company had revenue of $772.00 million during the quarter, compared to analyst estimates of $758.25 million. Zillow Group had a net margin of 2.27% and a return on equity of 1.41%. Zillow Group's revenue was up 17.9% compared to the same quarter last year. During the same period last year, the business earned $0.40 earnings per share. As a group, sell-side analysts predict that Zillow Group, Inc. will post 0.9 earnings per share for the current fiscal year.

Zillow Group Company Profile

Zillow Group NASDAQ: ZG is a U.S.-based online real estate marketplace that connects consumers, real estate professionals and mortgage lenders through a suite of digital products and advertising services. Founded in 2006 by Rich Barton and Lloyd Frink and headquartered in Seattle, Washington, the company operates a portfolio of consumer-facing brands and tools designed to simplify home search, rental discovery, valuation and mortgage shopping.

Zillow's core products include its consumer websites and mobile apps that list homes for sale and rent, the Zestimate automated home value estimate, and marketplaces that connect buyers and renters with agents and lenders.

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