Yahoo Finance Is There Now An Opportunity In Zillow Group, Inc. (NASDAQ:ZG)?
Zillow Group, Inc. (NASDAQ:ZG), which is in the interactive media and services business, and is based in United States, saw a significant share price rise of over 20% in the past couple of months on the NasdaqGS. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s take a look at Zillow Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for Zillow Group
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What’s the opportunity in Zillow Group?
According to my valuation model, the stock is currently overvalued by about 24.51%, trading at US$33.15 compared to my intrinsic value of $26.63. This means that the opportunity to buy Zillow Group at a good price has disappeared! But, is there another opportunity to buy low in the future? Since Zillow Group’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from Zillow Group?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. Zillow Group’s earnings over the next few years are expected to increase by 22%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in ZG’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe ZG should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on ZG for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for ZG, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Zillow Group. You can find everything you need to know about Zillow Group in the latest infographic research report. If you are no longer interested in Zillow Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
