Zillow (ZG) PT Raised to $32 After 1Q Beat - Suntrust

Suntrust analyst, Robert Peck, raised his PT on Zillow Group (NASDAQ: ZG) to $32 from $25 after 1Q revenues beat on strong performance from all key categories. FY’16 EBITDA guidance ex legal increased to ~$173M (midpoint) or 21% margins vs. $156 and 19% margins last quarter. Leads grew 60% YoY vs. ARPA of ~40% and revenue per lead -22%, highlighting positive site engagement and future potential pricing power. The analyst believes that "1Q illustrates the combined potential of higher performing agents, product innovation, and traffic." However, the outlook continues to call for a 2H ramp with legal costs materially higher than current levels and expectations.

The firm maintained a Buy rating.

For an analyst ratings summary and ratings history on Zillow Group click here. For more ratings news on Zillow Group click here.

Shares of Zillow Group closed at $29.05 yesterday.

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