Zillow Group Inc (NASDAQ: ZG) is set to report Q1 results today after the close with a call to follow at 5 pm ET. Following are the key estimates to watch out for.
The current S&P CapitalIQ consensus is for Zillow to swing from a loss in the year-ago period to a profit in 1Q21. Adjusted EPS is forecast to be $0.25 vs $(0.25) a year ago. Revenue is expected to decline slightly at 2% yr/yr to $1.10 bln. Revenue is expected to get back above $1 bln for the first time since 1Q20 when the pandemic began. Current guidance is for revenue of $1.069-1.112 bln and adjusted EBITDA of $114-138 mln.
The online real estate company has posted three consecutive large beats, which likely has raised expectations for another sizeable beat in Q1. What’s notable is that Zillow reported Q4 upside relative to prior guidance in all major segments (Homes, IMT, Premier Agent, Mortgages). Zillow also guided Q1 revenue well above consensus at the time.
Following a hot real estate market in 2020, Zillow is expecting an even stronger market in 2021. Zillow is projecting a near record of 6.8 mln home sales for 21% growth, plus double-digit home price appreciation. Zillow clearly believes that residential real estate will continue its brisk trajectory.
At first glance, it’s hard to reconcile how the market can have persistent low inventories of homes but still have robust sales. Keep in mind that homes are selling quickly. Think of it as a lean operating dynamic with just-in-time inventory management. It’s not only a strong housing market. The pandemic is causing more people to browse online, which is great for Zillow.
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