KeyBanc Downgrades Zillow Group (NASDAQ: ZG) Amidst Housing Slowdown

• KeyBanc downgraded Zillow Group (NASDAQ: ZG) to Sector Weight due to a significant slowdown in housing activity, with newly pending listings down 16.8% year-over-year.
• Zillow's adjusted Q3 2026 earnings of $0.55 per share missed the $0.60 consensus, and revenue of $724 million also fell short by 4.01%.
• Despite weakness in home sales, Zillow's rentals segment showed resilience, with third-quarter revenue growing 7%, helping to offset broader market challenges.

KeyBanc downgrades Zillow Group from Overweight to Sector Weight on November 9, 2026, with shares trading at $30.36 when the change is reported. Zillow runs online real estate listings and services for buyers, sellers, renters and agents. An Overweight rating signals an expectation that a stock will outperform its sector; Sector Weight signals expectations closer to the sector average.

The downgrade comes as Zillow reports slower housing activity. Its October Market Report shows newly pending listings down 16.8% from a year earlier, the largest annual decline since August 2023. Zillow’s preliminary measure of completed existing-home sales falls 8.7% year over year.

Mortgage rates above 7% make buying more expensive. Zillow estimates the typical mortgage payment is 12.8% higher than a year earlier, while its Observed Rent Index rises 2.9%. The gap helps explain why a weak home-sales market does not necessarily mean the same level of weakness in rentals.

Zillow reports adjusted third-quarter 2026 earnings of $0.55 per share, up from $0.44 a year earlier but below the $0.60 consensus estimate, as highlighted by Zacks Investment Research. Revenue rises to $724 million from $676 million but misses the consensus estimate by 4.01%.

Rentals help offset weakness in home sales as third-quarter revenue grows 7%, as highlighted by The Wall Street Journal. Zillow trades at $30.36, down $0.85, or 2.72%, with a 52-week range of $27.25 to $74.80.