Oppenheimer Maintains Perform on Zillow Group Inc as Guidance Came Below Expectations
Oppenheimer analyst Jason Helfstein came out with a few insights on Zillow Group Inc (NASDAQ:Z), after the company provided pro forma guidance for 2015, which was negatively impacted by weakness from Trulia. The analyst maintained a Perform rating, while Zillow shares are currently trading at $93.53, up $1.88 or 2.05%.
Helfstein noted, “We are lowering our ’16E EBITDA 40% following ’15 pro forma revenue guidance 13% below our estimate. Slower growth in the Trulia segment from: higher agent churn due to FTC delay; discontinuing Market Leader to new agents; reducing trulia.com display impressions; and transition of rentals/mortgages to Zillow platform, is driving the revenue weakness. As a result, ’15 EBITDA margin guidance is 745/787 bps below Opco/Street.”
Furthermore, “Management highlighted that Zillow core remains strong and will not be affected by the above issues, with growth expected to be driven more by ARPA versus sub-additions. Direct MLS feed accelerating, as management highlighted more listings today versus prior ListHub contract. We believe Z shares continue to discount bullish market share assumptions.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jason Helfstein has a total average return of 6.0% and a 55.1% success rate. Helfstein is ranked #690 out of 3574 analysts.