The Bullish Case for Zillow (Z)

Do you remember travel agents?

They used to be part of the town or city you resided in, and when summertime came people would rush in to find out the hotspots or the best deals. You would most likely be sent to a destination your agent had visited, or a cruise ship line they knew well. Even on a personal level, for the first fifteen years of my life, or until 2010, that's all I knew. In 2003, little did I know a company was taking form and control of the travel agency market slowly but effectively. That company is now known as the Priceline Group. In July of 2003, the price traded at roughly $25 a share. The company now owns Booking.com, PriceLine.com, Kayak.com, Cheapflights.com, Rental Cars.com, Opentable, and others. As of July 7th, 2017, the stock trades at $1,907.25. Incredible profits could've been accomplished due to an aggressive M&A strategy, the change of millennium travel, and the overall accessibility to the internet. Looking back, travel agents have become replaced by the internet.

Now you may ask, what does this have to do with Zillow?

In the future, within the next 10-20 years, I believe that the Zillow Group will follow a similar pattern. Zillow has acquired Trulia.com, HotPads.com, StreetEasy.com, NakedApartments.com, and their newly revamped site launching this year, RealEstate.com. This allows them to target a broader audience, and with the real estate market moving north, I believe it encourages home ownership, and the percentage of first time buyers is at an all time high. Technology will serve to be king, and the easiest method to the millennial generation. I am confident with the business model of Zillow, and will disclose to have ownership based off economics, their business model, and hopefully parcelling success of Priceline. Zillow currently trades at $46.80, and by the year's end I can see Zillow based of analysis and charts to be trading upwards of $55 per share.

Thank you for Reading!

Richard Goldstein




© 2019 by The Investors Herald.

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