December 16, 2025 — Zillow Group, Inc. stock is in the spotlight after a sharp, headline-driven drop tied to a new competitive worry: Google is testing a homes-for-sale experience directly inside Search. The surprise “portal wars” plot twist rattled investors on Monday, but Zillow shares stabilized and rebounded in Tuesday trading as analysts argued the near-term impact could be limited. [1]
As of late morning Dec. 16, Zillow’s Class C (NASDAQ: Z) traded around $70.80 and Class A (NASDAQ: ZG) around $69.52, both up from the prior close after Monday’s slide.
Below is what’s moving Zillow stock today—what Google is testing, what Wall Street is forecasting, and how Zillow’s latest results and housing-market outlook shape the setup into 2026.
Why Zillow stock dropped: Google is testing home listings inside Search
Multiple outlets reported that Google is running a limited experiment that displays property listings and details at the top of search results, in some cases with options to request tours and connect with agents—features that overlap with what consumers associate with real estate portals such as Zillow. [2]
According to reporting that cited Google’s own comments, the company described it as a “small experiment” in partnership with ComeHome by HouseCanary, showing listings and information “alongside existing real estate agent ads” on Google Search. [3]
Key details that mattered to investors:
- It appears limited to select markets (several reports cited cities such as Denver, Los Angeles, Miami, Houston, and others). [4]
- It’s largely described as mobile-focused (at least at this early stage). [5]
- The news gained traction after real estate strategist Mike DelPrete posted about what he was seeing in Search, framing it as a test with potentially big implications—but also calling much of the long-term interpretation “speculation.” [6]
Market reaction: Zillow shares fell hard Monday, with reports describing an ~8% drop (and in some coverage, an intraday slide into the low teens at points), pulling down other online real-estate names as well. [7]
The core fear: Zillow’s traffic and lead-gen engine vs. a Google “front door”
Zillow’s business is heavily tied to being a starting point for consumers shopping for homes and rentals—monetizing that demand through advertising and partner products (particularly in the “For Sale” ecosystem), plus expanding into adjacent services like mortgages and rentals.
So when Google hints it might become more than a map—and more like a native home-shopping interface—investors immediately model the worst-case scenario: fewer clicks to portals, higher customer acquisition costs, and pressure on advertising pricing power.
That said, several analyst takes circulating today push back on the immediate-doom narrative.
What analysts are saying today: “Long-term risk,” but near-term impact debated
Goldman Sachs: no near-term hit expected, but “long-term risk”
Investopedia reported that Goldman Sachs analysts told clients they don’t expect a direct near-term impact on Zillow’s business, citing Zillow’s high share of direct traffic and the experiment’s limited footprint, while still calling it a long-term risk for portals. [8]
Benchmark: maintains Buy, $95 target
In a note summarized by Investing.com, Benchmark maintained a Buy rating on Zillow with a $95 price target, arguing the market may be overreacting and noting Google has tried real-estate-related initiatives before. [9]
Wells Fargo: “meaningful disintermediation appears unlikely,” $73 target
A Wells Fargo view distributed via The Fly (and summarized by TipRanks and GuruFocus) suggested that while Google’s test could raise traffic acquisition costs, Zillow’s dependence on organic search is viewed as relatively low, making major disruption less likely. Wells Fargo’s stance cited an Equal Weight rating and a $73 price target in the summary. [10]
Morgan Stanley: Hold, $82 target (per TipRanks summary)
TipRanks also circulated a note saying a Morgan Stanley analyst maintained a Hold rating with an $82 price target, explicitly tying the stance to emerging competitive threats from Google and AI tools. [11]
Sandler: Buy, $85 target; questions around data/permissions
Another TipRanks roundup described Sandler as viewing the risk as overblown, with a Buy recommendation and $85 price target, and raised questions about whether Google can use certain listing data the way it’s being displayed. [12]
Bottom line on today’s Street view: The “Google enters real estate search” headline is being treated as strategic risk, not necessarily a near-term earnings reset—but it’s significant enough to inject a new uncertainty premium into Zillow’s valuation discussion. [13]
Zillow stock forecast: where consensus price targets sit now
Consensus target prices vary by database, but multiple aggregators today show material upside from current levels.
- Investing.com’s consensus snapshot cited 24 analysts, an average 12-month target around $88.71, with a high estimate near $105 and a low near $66, alongside a “Buy”-leaning consensus mix. [14]
- MarketBeat’s consensus summary similarly shows an average target in the high-$80s and the same general high/low neighborhood (high around $105; low mid-$60s). [15]
A useful way to read this: even after today’s volatility, many analysts still frame Zillow as a stock with upside potential—but the Google headline makes the path more contested, and targets may shift if the experiment scales.
The fundamentals check: Zillow’s latest quarterly results and guidance
Headline risk only matters so much if the underlying business is executing—and Zillow’s most recent reported quarter (Q3 2025) showed growth, improving profitability, and strong segment momentum.
Q3 2025 results: revenue up 16%, GAAP profitable
In its Q3 2025 release, Zillow reported:
- Revenue:$676 million, up 16% year over year
- GAAP net income:$10 million
- Adjusted EBITDA:$165 million (24% margin cited in the release) [16]
Segment highlights in the financial table included:
- For Sale revenue:$488 million (Residential $435 million, Mortgages $53 million)
- Rentals revenue:$174 million (up 41% year over year in the table) [17]
Zillow also disclosed it ended Q3 with cash and investments around $1.4 billion, and cited traffic/usage metrics including ~250 million average monthly unique users and ~2.5 billion visits in Q3. [18]
Q4 2025 outlook: revenue $645M–$655M; Adjusted EBITDA $145M–$155M
In its Q3 shareholder materials, Zillow provided Q4 2025 guidance (three months ending Dec. 31, 2025):
- Total revenue:$645 million to $655 million
- Adjusted EBITDA:$145 million to $155 million [19]
It also outlined expectations for category growth, including commentary that:
- Q4 Mortgages revenue growth could be ~20% year over year (in the outlook narrative), and
- Rentals revenue growth could be more than 45% year over year in Q4. [20]
Strategy: “integrated transaction” and product differentiation
Beyond the numbers, Zillow continues pitching an integrated product stack—tools that help consumers shop, then connect them to agents, financing, and rentals workflows.
In the shareholder letter, Zillow highlighted initiatives such as:
- Showcase (a premium listing format) reaching 3.2% of all new listings in the U.S. at the end of Q3
- AI-powered virtual staging added to Showcase listings
- BuyAbility, with 2.9 million people enrolled since launch
- A plan to roll out Zillow Pro across the country “throughout 2026” [21]
This matters in the “Google threat” debate: if Zillow can offer a more end-to-end experience (and deliver measurable conversion for partners), it may be harder to displace than a simple listings interface.
Zillow’s own housing market outlook: modest price growth, sales gradually improving
Because Zillow’s financial performance is tied to transaction activity (and consumer shopping intensity), the broader housing environment remains a key input.
Zillow forecast: home values +1.2% over 12 months; sales 4.09M in 2025, 4.26M in 2026
In its November 2025 forecast, Zillow projected:
- Modest home value growth (about +1.2% over the next 12 months in that update)
- Existing home sales around 4.09 million in 2025 (about +0.6% vs. 2024), with improvement into 2026 (Zillow cited 4.26 million for 2026 in the same report). [22]
Mortgage rates: near 2025 lows, but still a constraint
Freddie Mac’s weekly survey (as of Dec. 11, 2025) put the average 30-year fixed mortgage rate at ~6.22%. [23]
Lower than earlier-in-year peaks, yes—but still high enough to keep affordability tight and transactions “sticky.”
The lock-in effect is still real
Realtor.com research in December 2025 highlighted that many homeowners remain “locked in” by older, lower mortgage rates—estimating that moving and buying again could mean nearly $1,000 more per month in mortgage payments for a typical household. [24]
That dynamic tends to suppress inventory and transaction velocity—two things Zillow would like to see loosen.
A quieter bullish datapoint: Zestimates and Zillow’s data moat
While the Google headline is about distribution, Zillow’s long-run advantage is often framed as data + consumer mindshare + marketplace liquidity.
One timely example: HousingWire covered academic research suggesting the availability of a Zestimate can improve outcomes for buyers and sellers in aggregate, by influencing pricing behavior and negotiation dynamics. [25]
That doesn’t translate into next quarter’s EPS by itself—but it reinforces the thesis that Zillow’s pricing and behavioral data can be a durable differentiator.
Another Zillow headline today: Midwest markets dominate “most popular markets” rankings
Separately (and more “brand heat” than “stock catalyst”), Zillow released a 2025 markets ranking noting that affordability is driving interest toward midsize Midwest markets, with Rockford, Illinois cited as the No. 1 “most popular market” for Zillow shoppers in 2025. [26]
For investors, it’s another reminder that demand hasn’t vanished—it’s shifting to where budgets can still breathe.
What to watch next for Zillow stock
As of Dec. 16, 2025, Zillow’s near-term stock narrative is basically a three-body problem (always chaotic, never boring):
- Does Google scale this experiment?
If it stays small and localized, Zillow’s selloff may look like an overreaction. If it expands nationally (or becomes the default experience), Zillow’s long-term traffic economics get re-modeled. - Traffic mix and partner ROI
Analysts leaning “limited impact” emphasize Zillow’s direct traffic and brand-driven usage. If future disclosures show rising paid acquisition costs or weaker lead economics, sentiment could shift quickly. [27] - Execution against guidance
Zillow’s Q4 outlook (revenue $645M–$655M, Adj. EBITDA $145M–$155M) sets a benchmark. Strong delivery can help fundamentals reassert themselves over headlines. [28] - Housing cycle thawing
Mortgage rates near the year’s lows help—but affordability and lock-in remain major friction points. [29]
The takeaway for investors reading Zillow today
Zillow stock is trading in a classic tension: solid operating momentum vs. a potentially meaningful platform risk introduced by Google’s experimentation.
On one side, Zillow just posted double-digit revenue growth, improved profitability, expanding rentals and mortgage lines, and reiterated Q4 guidance with continued growth themes. [30]
On the other side, Google’s test forces a fresh question: How much of Zillow’s future growth depends on remaining the default discovery layer for home shopping—and how defendable is that position if search engines decide to “eat the interface”? The early analyst mood suggests caution, but not panic: long-term risk, uncertain scale, limited immediate damage—for now. [31]
References
1. www.investopedia.com, 2. www.investopedia.com, 3. www.barrons.com, 4. www.barrons.com, 5. www.investopedia.com, 6. www.mikedp.com, 7. www.barrons.com, 8. www.investopedia.com, 9. www.investing.com, 10. www.tipranks.com, 11. www.tipranks.com, 12. www.tipranks.com, 13. www.investopedia.com, 14. www.investing.com, 15. www.marketbeat.com, 16. s24.q4cdn.com, 17. s24.q4cdn.com, 18. s24.q4cdn.com, 19. investors.zillowgroup.com, 20. investors.zillowgroup.com, 21. investors.zillowgroup.com, 22. www.zillow.com, 23. apnews.com, 24. www.realtor.com, 25. www.housingwire.com, 26. investors.zillowgroup.com, 27. www.investopedia.com, 28. investors.zillowgroup.com, 29. apnews.com, 30. s24.q4cdn.com, 31. www.investopedia.com
