Motley Fool Money The Once & Future Zillow
Feb 16, 2023
Jim Mueller, a Senior Analyst at Motley Fool, dives into Zillow Group's recent financial performance and strategic pivot away from iBuying, highlighting its newfound focus on rentals and virtual tours. He discusses the implications of this shift and what to watch in Redfin's upcoming report. Joining him, fellow analyst Sanmeet Deo shines a light on hidden investment gems that Wall Street tends to overlook, emphasizing the potential in smaller-cap companies like Chipotle and Shake Shack, and even essential retailers like Tractor Supply.
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Zillow's iBuying Exit
- Zillow exited iBuying after their pricing algorithm failed, leading to losses.
- They sold remaining inventory, boosting cash flow but posing future revenue questions.
Zillow's Reinvention
- Zillow pivots to rentals, mortgages, partner agencies, and virtual tours after iBuying.
- They acquired a photography/video company for enhanced house visuals and real-time tours.
Zillow and Opendoor Partnership
- Zillow partners with former rival Opendoor, offering cash offers alongside Zestimates.
- iBuying's profitability is questioned, especially with falling house prices.