Zillow Group, Inc. (NASDAQ:Z) closed almost 25% lower on Wednesday following the company’s unexpected announcement of closing down the iBuying business in a painful near-term strategy change.

Analysts at RBC Capital provided their views on this announcement, lowering their price target on the company’s shares to $100 from $145.

According to the analysts, the overhang from this is threefold:

(1) Eliminating iBuying removes the clear down-funnel thesis thought to be critical to capturing seller listings,

(2) Management's explanation of alternatives around new products, potential partnerships and any other drivers of capturing seller signal is either not the clear path that iBuying represented and/or are going to take time to develop,

(3) Selling down inventory could persist into next year exposing the company to further balance sheet risk.