The stock market was having a modestly weak day on Friday, with all three major averages in the red by less than 1% at 10 a.m ET. However, real estate technology leader Zillow Group (NASDAQ:ZG)(NASDAQ:Z) was heading in the opposite direction -- shares were up by 7% and had risen by more than 10% earlier in the trading session.
Zillow gave investors an update on the winding down of its iBuying business on Thursday afternoon, and there were two key points that are fueling today's news.
First, Zillow announced the sale of the nearly 10,000 homes it owns is progressing faster than expected. The company reported it is under contract or agreement to sell on more than half of the real estate it needs to dispose of. This is significantly faster than Zillow's management anticipated, and it caused the company to raise its fourth-quarter expectation for home-selling revenue from $1.9 billion at the midpoint of its guidance range to $2.6 billion.
Second, Zillow announced what it plans to do with its higher-than-expected infusion of cash. The board has authorized Zillow to buy back as much as $750 million of its own stock, and with a total market cap of less than $15 billion even after today's move, this is a significant return of capital to investors.
This is certainly good news for investors, but there are still some big unanswered questions that remain about what Zillow's next moves will be after the iBuying wind-down is complete. For now, though, it's encouraging to see that things are heading in the right direction.