Zillow's stock sinks after downbeat sales outlook, analyst downgrade
Shares of Zillow Group Inc. sank 8.3% in premarket trade Tuesday, after the real estate-related information marketplace provided a downbeat sales outlook, and an RBC Capital ratings downgrade, citing valuation. RBC analyst Mark Mahaney cut his rating to sector perform, after being at outperform since March 2016, but bumped up his price target to $52 from $51. He said Zillow delivered "strong" first-quarter results, but it may be entering a "transition year" as the move into direct home sales increases its total addressable market but increases execution risk. That, and the fact that stock has surged above his price target prompted him to back away from his bullish stance. The stock soared 17.6% over the past six sessions to close at $55.60. It has rocketed 36.5% year to date through Monday, while the S&P 500 has slipped less than 0.1%.
