Wedbush downgrades Zillow after co pauses homebuying

Offerpad Solutions

19/10/2021 13:27

** Wedbush downgrades shares of online real estate co  ZG.O 
to "neutral" from "outperform"
    ** Cuts stock PT to $86 from $153 after ZG said on Monday it
would pause buying houses this year  urn:newsml:reuters.com:*:nL4N2RE3HM
    ** Brokerage says Zillow is seeing a backlog in renovations
and operational capacity constraints, driven by a labor and
supply crunch
    ** Pausing offers, even for a few months will have
ramifications across Zillow's other businesses in 2022 - Wedbush
    ** Expects Zillow will concede market share to rivals
Opendoor Technologies  OPEN.O , Offerpad Solutions  OPAD.N 
    ** ZG shares down 0.4% at $85.06 premarket
    ** The U.S. housing sector that earlier witnessed a boom has
lost its momentum in recent months, hurt by a tight jobs market,
supply chain issues and shortage of raw materials 
    ** BofA analysts believe Zillow's decision might be affected
by slowing homes sales and co's inability to sell through at the
same rate at which it is acquiring, as buyers take a step back
   ** Shares of ZG down 37.1% YTD

 (Reporting by Kannaki Deka in Bengaluru)
 ((Kannaki.Deka@thomsonreuters.com))