What happened
Zillow Group shareholders outperformed a rising market last month. Shares rose 22% in February compared to a 2.6% gain in the S&P 500, according to data provided by S&P Global Market Intelligence.
The rally added to gains for the real estate marketing platform, which has risen more than 200% since last March.
So what
Investors cheered Zillow’s fourth-quarter results that on Feb. 10 revealed strong operating trends. Sales surpassed management’s forecast as home shoppers flocked to its tech platform. Zillow’s traffic touched 2.2 billion visits in Q4, up 27% from the prior year. “[Our] strong results reflected exemplary execution,” CEO Rich Barton said in a press release, “and continued growth during the scary roller-coaster ride that was 2020.”
Now what
The housing market will cool off at some point, but the relative lack of supply in many areas suggests Zillow will continue being a valued tool for connecting home shoppers to real estate agents. And, while it’s not clear how profitable the company will be once industry conditions return to normal, it’s an unqualified positive for the business that it is expanding its reach to more shoppers and establishing complementary services like mortgages.