(Reuters) – Shares of Zillow Group Inc rose 13% premarket on Friday after the online real estate firm’s fourth-quarter revenue handily beat estimates on a strong performance in its home segment.
The segment, which helps customers list their properties for sale, marked an 11-fold rise in revenue as Zillow managed to sell inventory faster and at better prices despite setbacks from the Omicron COVID-19 variant.
The results hint at a turn in Zillow’s fortunes. Its shares had slumped nearly 50% in November, when unpredictable home prices forced it to announce a surprise exit from its business of flipping houses, a venture that was expected to disrupt the real estate market.
On Friday, Zillow posted quarterly revenue of $3.88 billion, compared with $789 million a year earlier and far higher than analysts’ estimate of $2.98 billion, according to Refinitiv data.
Several brokerages raised their price targets for the company on Friday, encouraged by its transformation to move towards a “housing super app”. The Seattle-based company’s new app aims to integrate the currently fragmented process of buying or selling a house.
“Zillow economists seem more optimistic than the consensus industry forecast, but also management is using a more cautious view in its outlook,” brokerage Wedbush said in a note.
(Reporting by Nathan Gomes in Bengaluru; Editing by Devika Syamnath)