Zillow Group Approaching Key Technical Levels: Is It Time to Buy?

Zillow Group (ZG) is demonstrating a strong recovery, with Q2 2025 revenue up 15% year-over-year to $655 million, exceeding expectations, primarily driven by a 36% increase in rental revenue following its strategic Redfin partnership. This performance signals a successful pivot away from the costly Zillow Offers iBuying program, which previously led to substantial losses and a significant stock decline. Coupled with bullish technical indicators like a recent Golden Cross and analyst target upgrades, ZG's improving fundamentals suggest sustained momentum, despite an average 'Hold' rating and a slight EPS miss attributed to strategic investments.

Analysis

Zillow Group (ZG) is demonstrating a significant operational and financial turnaround following the costly failure of its iBuying program, Zillow Offers, which generated a $422 million loss in Q3 2021. The company's strategic pivot is validated by its Q2 2025 results, where revenue grew 15% year-over-year to $655 million, beating expectations and marking its highest revenue figure since Q2 2021. This growth was primarily fueled by a 36% YoY increase in rental revenue to $159 million, a direct result of its new partnership with Redfin. While earnings per share of 40 cents missed the 44-cent estimate, this was attributed to strategic investments in marketing and partnerships rather than a decline in core profitability. This fundamental recovery is supported by bullish technical indicators, including a recent "Golden Cross" on its daily chart—a signal that preceded an 80% appreciation on its last occurrence—and a nearly 20% stock price increase over the last three months on high volume. Despite a consensus "Hold" rating, ten research firms have raised their price targets post-earnings, reflecting growing confidence, although the average target of $85.62 suggests limited immediate upside from its current price.

Key Decisions for Investors

• Investors should recognize the successful strategic pivot from the capital-intensive iBuying model to a partnership-driven rental focus, which has reignited top-line growth and could form the basis for a long-term bullish thesis.
• Momentum-focused traders may find the combination of a recent Golden Cross formation, strong relative price strength, and increasing volume to be a compelling technical entry signal, though the proximity to the 2025 high warrants caution.
• Given the stock is approaching the consensus analyst price target and carries a 'Hold' rating, risk-averse investors should monitor future earnings reports closely to ensure recent strategic investments translate into improved profitability and justify further upside beyond current targets.