Zillow Reports Healthy Q4 Results With COVID-Induced Housing Boom Providing Tailwind

Zillow Group reported impressive fourth-quarter results, with the firm benefiting from the countercyclical effect of a buoyant housing market amid the coronavirus-induced economic recession. For the fourth quarter, the firm reported total revenue of around $789 million, a 16% decrease from the fourth quarter of 2019. Full-year 2020 revenue came in at $3.3 billion, a 22% increase from 2019. Companywide adjusted EBITDA showed improvement in the positive environment, coming in at $170 million for the quarter, a significant improvement from negative $3 million for the fourth quarter of 2019. Full-year adjusted EBITDA was $343 million, sharply higher from $39 million during 2019. Despite the impressive recent financial results, we are maintaining our $42 fair value estimate for no-moat-rated Zillow Group.