• Piper Sandler updated its rating for Zillow Group Inc (NASDAQ: ZG) to "Overweight" despite concerns over Google's entry into real estate advertising.
• Zillow's stock declined by 8.5% following reports of Google testing a new real estate ad format that could directly compete with Zillow's platform.
• The introduction of Google's new ad unit poses a direct challenge to Zillow's market position, potentially disrupting its lead-generation business and affecting its Premier Agent program.

Zillow Group Inc (NASDAQ: ZG) is a prominent player in the online real estate market, providing a platform for home buyers, sellers, and real estate professionals. The company generates revenue primarily through its Premier Agent program, which connects real estate agents with potential clients. However, Zillow faces competition from other real estate platforms and now, potentially, from tech giant Google.

On December 15, 2025, Piper Sandler updated its rating for Zillow to "Overweight," with the stock priced at $66.18. This rating suggests that Piper Sandler sees potential for the stock to outperform the market. Despite this positive outlook, the recommendation to "hold" indicates caution, likely due to concerns about Google's new real estate advertising format, as highlighted by TheFly.

Zillow's shares recently declined by 8.5% following reports of Google's testing of a new mobile real estate ad format. This format, developed with ComeHome, allows users to view live MLS listings and schedule home tours directly through Google search results. This feature could impact Zillow's lead-generation business by reducing traffic to its platform and affecting its Premier Agent program.

The introduction of Google's new ad unit poses a direct challenge to Zillow's market position. By offering features similar to those on Zillow, such as filters for bedrooms, bathrooms, and price, Google aims to attract users to its platform. This move has raised investor concerns, contributing to the selling pressure on Zillow's stock, which is currently priced at $66.03, reflecting a decrease of 8.77%.

Zillow's stock has experienced significant volatility, with a trading range of $63.15 to $67.08 during the day. The company's market capitalization is approximately $15.98 billion, and the trading volume reached 1,655,895 shares on the NASDAQ exchange. As Google tests its new ad format, Zillow's market position and revenue streams face potential disruption, leading to investor apprehension.