Zillow Quits Home Buying Business; Stock Plummets

No less than 12 analysts dished out bear notes for ZG

Deputy Editor
Nov 3, 2021 at 10:57 AM
facebook X logo linkedin


Zillow Group Inc (NASDAQ:ZG) is plummeting today, last seen 18.2% lower to trade at $69.94, following news that the real estate firm is exiting the home-flipping game on the closure of Zillow Offers. The company said it could lose more than $550 million on homes purchased in the latter half of 2021, partly due to a faulty algorithm designed to profitably buy and sell homes, and will have to lay off around a quarter of its staff. Putting more pressure on the equity, Zillow reported top- and bottom-line misses for the third-quarter, and expects to lose an additional $240 million to $265 million in the fourth-quarter.

Analysts were quick to respond to the dismal news, with no less than 12 bear notes rolling in this morning. Truist Securities had the most noteworthy reaction, cutting its rating on ZG to "hold" from "buy," and slashed its price target to $83 from $140. These analysts join a split brokerage bunch, as nine of the 20 in coverage already called Zillow stock a "hold" or worse coming into today.

Put activity has ramped up in response, as well. ZG's normally quiet options pits have seen 3,209 puts across the tape already today, which is 32 times what's typically seen at this point and more than double the amount of calls traded so far. Most popular is the November 70 put, followed by the 60 put in the same monthly series, with new positions being opened at both. 

Zillow stock is trading at its lowest level since August 2020 and well below its Feb. 16 all-time high of $212.40. The formerly supportive 120-day moving average stifled a rally attempt in late October, and today's drop puts the security below a recent floor at the $85 level. Pacing for its biggest daily percentage drop since March 2020, ZG now sports a 46.7% year-to-date deficit.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI