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Zillow Stock Near 52-Week Lows: Is It Time to Buy the Dip?
Zillow Group shares have fallen sharply toward 52-week lows, potentially putting the online real estate giant back on investors’ radars.
Zillow’s Class C shares (Z - Free Report) ) and Class A shares (ZG - Free Report) ) are both trading around $30, just above their respective 52-week lows of $29 a share.
However, the housing backdrop remains challenging. The Federal Reserve raised its benchmark rate by 25 basis points this week to a range of 3.75%-4.00%, while the average 30-year fixed mortgage rate has climbed to 6.95%, up from 6.76% a week earlier and 6.26% a year ago.
While the Fed does not directly set mortgage rates, additional monetary tightening can reinforce elevated borrowing costs and housing affordability concerns—a clear near-term headwind for Zillow’s home-buying and mortgage ecosystem.
Image Source: Federal Reserve Economic Data
Z vs. ZG: What's the Difference?
Investors essentially get exposure to the same underlying Zillow business with either ticker.
ZG represents Zillow's Class A common stock, which carries voting rights, while Z represents Class C shares, which generally have no voting rights. Zillow also has unlisted Class B shares with enhanced voting power.
For most investors focused primarily on Zillow's financial performance, the economic exposure of Z and ZG is largely similar, although the shares can trade at slightly different prices because of voting rights, liquidity, and supply.
Zillow's Growth Outlook Remains Solid
Despite housing-market weakness, Zillow continues to grow faster than the broader residential real estate market.
Most recently, Q2 revenue increased 18% to $772 million, with residential revenue rising 7%, rentals revenue jumping 31%, and mortgage revenue surging 75% as purchase-loan originations nearly doubled.
Management expects 2026 revenue of $2.92-$2.96 billion (+13% growth) and adjusted EBITDA of $730-$760 million (+17% growth).
Meanwhile, the Zacks Consensus calls for EPS of $2.22 this year, up 35%, followed by another 21% increase to $2.69 per share in 2027. That said, FY26 and FY27 earnings estimates are slightly down in the last 60 days, reflecting the more difficult housing environment.
Image Source: Zacks Investment Research
Zillow's Valuation Looks More Appealing
The selloff has made Zillow’s valuation considerably more appealing, with Z and ZG shares trading at roughly 13X forward earnings and near the often preferred level of less than 2X forward sales.
Both metrics offer a compelling discount to the benchmark S&P 500, although inexpensive shares alone may not be enough to overcome another prolonged period of elevated mortgage rates.
Image Source: Zacks Investment Research
Bottom Line
Zillow's plunge toward 52-week lows has created a much more reasonable valuation, while double-digit revenue growth and strong expansion across its mortgage and rental businesses provide reasons for longer-term optimism.
However, the Fed's latest rate hike and mortgage rates approaching 7% could keep housing activity subdued and limit Zillow's near-term upside.
For now, Zillow's Z and ZG shares both land a Zacks Rank #3 (Hold), suggesting investors may want to see greater improvement in the interest-rate and housing outlook before aggressively buying the dip.
View the Zacks #1 Rank List
Image: Bigstock
Zillow Stock Near 52-Week Lows: Is It Time to Buy the Dip?
Zillow Group shares have fallen sharply toward 52-week lows, potentially putting the online real estate giant back on investors’ radars.
Zillow’s Class C shares (Z - Free Report) ) and Class A shares (ZG - Free Report) ) are both trading around $30, just above their respective 52-week lows of $29 a share.
However, the housing backdrop remains challenging. The Federal Reserve raised its benchmark rate by 25 basis points this week to a range of 3.75%-4.00%, while the average 30-year fixed mortgage rate has climbed to 6.95%, up from 6.76% a week earlier and 6.26% a year ago.
While the Fed does not directly set mortgage rates, additional monetary tightening can reinforce elevated borrowing costs and housing affordability concerns—a clear near-term headwind for Zillow’s home-buying and mortgage ecosystem.
Image Source: Federal Reserve Economic Data
Z vs. ZG: What's the Difference?
Investors essentially get exposure to the same underlying Zillow business with either ticker.
ZG represents Zillow's Class A common stock, which carries voting rights, while Z represents Class C shares, which generally have no voting rights. Zillow also has unlisted Class B shares with enhanced voting power.
For most investors focused primarily on Zillow's financial performance, the economic exposure of Z and ZG is largely similar, although the shares can trade at slightly different prices because of voting rights, liquidity, and supply.
Zillow's Growth Outlook Remains Solid
Despite housing-market weakness, Zillow continues to grow faster than the broader residential real estate market.
Most recently, Q2 revenue increased 18% to $772 million, with residential revenue rising 7%, rentals revenue jumping 31%, and mortgage revenue surging 75% as purchase-loan originations nearly doubled.
Management expects 2026 revenue of $2.92-$2.96 billion (+13% growth) and adjusted EBITDA of $730-$760 million (+17% growth).
Meanwhile, the Zacks Consensus calls for EPS of $2.22 this year, up 35%, followed by another 21% increase to $2.69 per share in 2027. That said, FY26 and FY27 earnings estimates are slightly down in the last 60 days, reflecting the more difficult housing environment.
Image Source: Zacks Investment Research
Zillow's Valuation Looks More Appealing
The selloff has made Zillow’s valuation considerably more appealing, with Z and ZG shares trading at roughly 13X forward earnings and near the often preferred level of less than 2X forward sales.
Both metrics offer a compelling discount to the benchmark S&P 500, although inexpensive shares alone may not be enough to overcome another prolonged period of elevated mortgage rates.
Image Source: Zacks Investment Research
Bottom Line
Zillow's plunge toward 52-week lows has created a much more reasonable valuation, while double-digit revenue growth and strong expansion across its mortgage and rental businesses provide reasons for longer-term optimism.
However, the Fed's latest rate hike and mortgage rates approaching 7% could keep housing activity subdued and limit Zillow's near-term upside.
For now, Zillow's Z and ZG shares both land a Zacks Rank #3 (Hold), suggesting investors may want to see greater improvement in the interest-rate and housing outlook before aggressively buying the dip.