How Investors Are Reacting To Zillow Group (ZG) Facing FTC Antitrust Lawsuit Over Rental Advertising Deal

• In recent days, the Federal Trade Commission and attorneys general from five states filed lawsuits against Zillow Group and Redfin, alleging a US$100 million agreement between the companies unlawfully restricted competition in the multifamily rental advertising market by having Redfin exit this segment and transfer clients to Zillow.
• This legal challenge intensifies scrutiny on Zillow as it simultaneously faces class-action and intellectual property lawsuits, raising questions about the company's compliance practices and future regulatory obligations.
• We'll examine how these mounting antitrust and legal risks challenge Zillow's investment narrative of leveraging industry partnerships for digital leadership.

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Zillow Group Investment Narrative Recap

For shareholders, the core proposition in Zillow Group is the company’s ability to harness digital transformation, innovative partnerships, and high consumer engagement to drive revenue growth and extend market leadership in U.S. real estate technology. However, the recent wave of antitrust and class-action lawsuits, including the FTC’s complaint over the US$100 million Redfin agreement, has placed Zillow’s partnership strategy, and regulatory risk management, under greater scrutiny, potentially clouding sentiment around short-term revenue catalysts and elevating legal and compliance risks as a top concern for now.

Amid these developments, Zillow’s latest earnings report stands out: Q2 2025 saw revenue rise to US$641 million with a return to modest profitability, and full-year revenue growth guidance was lifted to the mid-teens. This financial momentum provided evidence of underlying demand and operational progress, even as the business contends with new legal headwinds that could impact future partnerships, platform expansion, or cost forecasting.

Yet, investors must remain mindful of the heightened legal risk from the FTC and ongoing litigation, as outcomes here could reshape the company’s...

Read the full narrative on Zillow Group (it's free!)

Zillow Group's narrative projects $3.6 billion revenue and $415.2 million earnings by 2028. This requires 14.8% yearly revenue growth and a $477.2 million increase in earnings from -$62.0 million today.

Uncover how Zillow Group's forecasts yield a $88.46 fair value, a 22% upside to its current price.

Exploring Other Perspectives

Seven fair value estimates from the Simply Wall St Community range from US$28.38 to US$92.03 per share, highlighting wide variations in outlook. While many anticipate continued digital innovation and revenue growth, the latest regulatory actions bring compliance practices and partnership models into focus for long-term performance considerations.

Explore 7 other fair value estimates on Zillow Group - why the stock might be worth as much as 27% more than the current price!

Build Your Own Zillow Group Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Zillow Group research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free Zillow Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Zillow Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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