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Zillow (ZG) Surges 8.7%: Is This an Indication of Further Gains?

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Zillow Group (ZG - Free Report) shares rallied 8.7% in the last trading session to close at $64.96. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 12.7% loss over the past four weeks.

Zillow Group is benefiting from solid demand trends in the residential and rental verticals. Its advanced technology, such as its New Construction marketplace Real-Time Touring and software solutions from ShowingTime+, is gaining strong popularity. The company constantly adds new features to bolster the experience for property managers and consumers. It aims to capitalize on AI technology as it intends to introduce several AI advancements in 2025. The focus will be on improving visual and multimodal capabilities, including more rich media content. Generative AI will empower home shoppers with insights and guidance on home financing. It will also enable real estate agents to better connect and engage with more potential customers. These factors have instilled investor confidence, which probably drove the share price appreciation.

This online real estate marketplace is expected to post quarterly earnings of $0.47 per share in its upcoming report, which represents a year-over-year change of +30.6%. Revenues are expected to be $588.55 million, up 11.3% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Zillow, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on ZG going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Zillow is part of the Zacks Financial - Mortgage & Related Services industry. Walker & Dunlop (WD - Free Report) , another stock in the same industry, closed the last trading session 6.5% higher at $78.65. WD has returned -14.5% in the past month.

For Walker & Dunlop, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.98. This represents a change of -17.7% from what the company reported a year ago. Walker & Dunlop currently has a Zacks Rank of #1 (Strong Buy).


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