If you have a contract to purchase leads from Zillow, you may want to re-evaluate what you are paying because to industry analysts from Barclays report its their web traffic is in a downward spiral.
It’s been 5 months since Zillow bought Trulia for $2.5 billion in a “stock-for-stock” transaction.
But the transition from 2 brands to 1 and increased competition fromRealtor.comhave industry analysts questioning the future of Zillow.
In a new report, Barclays (B) cites Zillow and Trulia’s slowing web traffic, as a reason for downgrading Zillow for the 2nd time in 3 months and lowering its (stock) price target from $90 to $70.
Barclays previously downgraded Zillow in April, citing slowing web traffic then as well.
According to the Barclays report, Zillow’s slowing web traffic growth is the result of “category saturation” and Realtor.com’s resurgence.
The combined traffic growth of Zillow Group’s 4 consumer brands (Zillow, Trulia, StreetEasy, and HotPads) – fell 33% year-over-year from the same time period last year, marking a new low for growth.
Analysts also point to the departure of Zillow CFO Chad Cohen, who announced earlier this month he intends to step down, creating more execution risk for Zillow in the back half of this year and in 2016 as well.