Barclays has upgraded Zillow from Underweight to Equal Weight, citing improved execution despite continued challenges in the U.S. housing market. The firm increased its price target to $72 from $66. Although issues like affordability and competition persist, Barclays believes much of the downside risk is already factored into the shares. This upgrade reflects growing confidence in Zillow's performance.

Zillow has demonstrated consistent revenue and adjusted EBITDA growth over the past two years, even amidst a weak housing market. Barclays cited Zillow’s outperformance of transaction volumes as a key reason for the upgrade. Furthermore, they anticipate easing competitive pressures due to reduced investment by Costar Group in Homes.com. Valuation also appears more reasonable.

Investors are expected to focus on Zillow's 2026 growth and margin expansion. Barclays anticipates growth in rentals and new products, such as Zillow Pro, will offset concerns about housing trends. While a clear housing recovery path remains uncertain, Barclays believes that the risk-reward profile for Zillow is now more balanced as the year begins.