Analysts Cut Targets as ZG Bears Pile Into Options

Why this matters: Zillow Group has dropped 17% in a month. Major brokers are slashing price targets. Options traders just pushed the put-call ratio to its most bearish reading in weeks. Three signals. All pointing the same way.

Analysts Keep Lowering the Bar

The analyst action on ZG has been relentlessly negative. Goldman Sachs cut its price target to $40 from $53 on June 12. RBC Capital followed, dropping its target from $95 to $70 on June 10. Both firms kept ratings unchanged — but the targets tell the story.

The consensus mean target sits at $62.86. The stock trades at $30.50. That gap looks wide until you see that virtually every recent revision has been downward. Citi, Barclays, Wells Fargo, Piper Sandler, Keybanc, and Mizuho all cut targets in early May. None upgraded.

Options Traders Turn Bearish

The put-call ratio hit 1.13 on June 24. That is 2.3 standard deviations above its 20-day mean of 0.75. It is the most defensive options positioning seen on ZG since the ratio was running at normal levels through most of May and early June. The shift was abrupt. Three days earlier the PCR read 0.54.

The 52-week range on the PCR runs from 0.05 to 2.92. At 1.13, the market is not at peak fear. But the pace of change — from 0.54 to 1.13 in less than a week — signals a clear shift in how the options market is positioned.

Short Sellers Backing Off

SI fell 14% in a week to 6.33% of free float. That covering came as the stock fell, not rose. Short sellers are taking profits into weakness, not chasing the move lower. The borrow market reflects this: availability stands at 336% — more than three shares available to borrow for every one already lent out. Cost to borrow dropped 50% in a week to just 0.39%.

The lending market is loose. A squeeze is not the story here.

Institutional Activity Worth Watching

Capital Research added 6.45 million shares (last reported May 29). Independent Franchise Partners added 2.96 million. Tiger Global added 1.31 million. These are meaningful builds from active managers — at prices well above where the stock sits today.

Next earnings are due August 5.

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• Price: $30.50, down 17.3% over one month
• SI % FF: 6.33%, down 14% week-on-week
• Cost to borrow: 0.39%, down 50.5% in a week
• Borrow availability: 336% — loose market
• PCR: 1.13 (z-score: +2.3 vs 20-day mean of 0.75)
• Goldman Sachs target: $40 (cut from $53, Jun 12)
• RBC Capital target: $70 (cut from $95, Jun 10)
• Consensus mean target: $62.86