ZG. Zillow a new monopoly of real estate on the internet?
Zillow Group is the company that is known for being an online real estate database company. Zillow has a product called the Zestimate. It is a machine made assessment of home values. The Zestimate is roughly pretty good at gauging values of homes based off of looking at what the properties around the one being sold were sold for recently and in the past. It may not get prices exact but every if not most real estate agencies use their database to help with pricing. Most people when working with a real estate agencies look at at the Zestimate value of their home before they even go to a broker. Zillow itself owns 75% of the online real estate marketplace.
After everything that is said it is easy to see the value in their business as it is. Zillow has unique power in real estate to leverage the information of the database. The data and machine learning Zillow has is capable of disrupting how real estate is done!
The newest transformation for this business is that Zillow will now buy and sell properties and not just be a source of information for real estate agencies and personal consumers. The unique database knowledge will allow Zillow to make some of the best moves in real estate. Probably getting the highest margins as well! I cannot even name another real estate agency that can leverage the knowledge they have.
In my eyes Zillow Group has many years more to grow on the revenue side and the cash flow side. They are projecting a 39% increase this year in revenue and I would project at least 20% increase in revenue for the next five years on average as well. I think that is conservative as well based off of their unique position in the market. After all in the last five years Zillow has increased its revenue at a 55% clip! That is impressive and there is still room for growth.
As always this is not financial advise nor is it presented that way. The information provided in this blog post and any other posts that I make and any accompanying material is for informational purposes only. It should not be considered financial or investment advice of any kind. One should consult with a financial or investment professional to determine what may be best for your individual needs.
Adios Amoebas, it is time for me to ride off into the sunset
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