American online real-estate marketplace company Zillow Group Inc. (ZG) recently reported to lay off upto 300 employees. The economic slowdown of the ongoing year has made many companies suffer heavy blows and they cited reducing workforce is one potential solution. The company cited shifting of its focus towards positions related to technology. The company notified employees affected after the decision.
The employees said to leave the company were from different sectors within the company. Including Zillow Offer advisors, PA sales and staff working at the back end of Zillow Home Loans and its Closing Services. Such decisions of tech companies are subject to impact on their stock prices. So is expected to remain the case with Zillow stock.
Zillow Stock Already Facing Headwinds
Sentiments around the Zillow stock are already not very favorable where analysts were seen to decrease their estimates for the company’s earnings per share (EPS). Analysts at Jefferies Financial Group Research reduced their prediction for EPS by Q4 2023 from 0.05 USD to 0.04 USD. The estimates for EPS for Zillow stock for the ongoing year is 0.17 USD.
Nasdaq data shows the disparity between estimated and the reported EPS figures of Zillow stock in the past. For Q1 2022 EPS was estimated -0.07 USD but it was reported 0.19 USD. While in the following quarter, it was estimated 0.16 USD but was reported 0.06 USD.
The estimated EPS for Q3 2022 is -0.28 USD and if it goes right or not would be clarified only after the earnings release of Zillow stock on 2nd November 2022.
Zillow Stock Price Could Suffer More
Currently Zillow (ZG) stock is trading at 30.94 USD after a slight up from yesterday. However, in the longer timeframe the stock is clearly visible to see a tumble in the past. The current trading price is approx 19.95% down in the last six months while it’s up to 70% down from where it was a year ago.
Analysts also reduced the target price as well as rating for Zillow stock. Earlier Canaccord Genuity Group estimated 60 USD for the stock but later reduced it to 55 USD with the rating to “buy”. Compass Point and MarketBeat estimated the target price 50 USD and 57.76 USD respectively.
Given the recent layoffs, Zillow stock is likely to face the repercussions. The recently laid off employees account for about 5% of the overall workforce as implied after the data highlighted in the SEC filing. The filing noted the company had 5,791 employees at the time.
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational ideas only, and they do not establish the financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Source: https://www.thecoinrepublic.com/2022/10/29/laying-off-300-employees-likely-to-affect-zillow-stock/