Zillow (Z 3.37%) (ZG 4.05%) is such a dominant player in the online home search and real estate agent service market that its name has become synonymous with what it does. But there's a whole new focus of the business that could potentially catapult the company into mega-cap territory. In this Fool Live video clip recorded on June 15, Fool.com contributors Matt Frankel, CFP, and Jason Hall, along with Chief Growth Officer Anand Chokkavelu discuss Zillow and why they ranked it No. 1 out of 15 top housing stocks.
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Anand Chokkavelu: So Zillow, most people know, so I'll be really quick. It's a $27 billion market cap. I think it's the second largest. I think AvalonBay (AVB 1.40%) is like $29 billion or something. But in terms of 10x'ing, I think Zillow might have one of the best shots of 10x'ing, even though it's one of the larger ones. Could it be a $300 billion company one day? I think in the home space and given all it does, absolutely. It's really the leader in the online disruption of real estate. Recently, it had entire Saturday Night Live skit about it that shows how prevalent Zillow is. I'd highly recommend looking that one up, pretty darn funny. I don't want to ruin it, and might not be safe for Motley Fool Live. Then if you're like me, you get those emails with your Zestimate changing, you can't help but look, and that database has gotten better and better over time. I remember maybe 10 years ago just being like, "Oh man, it's way off on things." Now it's getting really close.
Jason Hall: But they're turning that into cash offers in some markets.
Chokkavelu: Yeah. You need to be good. People on those reifies I think a lot of people use that's Zestimate close enough. It's a top real estate website in the U.S., 221 million monthly unique users, about five times the size of Redfin (RDFN 4.96%), before that last acquisition. It simply does everything, whether it's generating leads for agents, buying, and selling homes directly themselves, doing home loans, providing all the related services, etc. It has scale, it has growth. Thirty-seven percent, five-year average, even being pandemic flat this last year, and leadership. I'm a big fan of the Co- Founder and CEO, Rich Barton. There's a reason it's our consensus number one. What all do you have to say? Got a few minutes left.
Hall: I just want to say that I think looking at that and Redfin, because people a lot of times are like, "What's the difference?" They're certainly becoming more and more the same. But I think at the end of the day, five years from now, they're both going to look a lot more like Zillow already looks. That's why I rated it as high as I did.
Frankel: I think people are underestimating how much of an advantage Zillow has an iBuying. Their website has something like 160 million monthly active users.
Hall: That data is so valuable.
Frankel: Those are people who could be easily converted. No one goes to Opendoor's (OPEN 3.69%) website unless they're actively looking to sell their house to Opendoor. Zillow has the advantage, over 160 million people are coming to their website anyway. I am a big Zillow fan, and I think they're going to be the biggest winner of iBuying. Although there's room for a few winners, I think they're going to be the big one.
