Robbins Geller Rudman & Dowd LLP announces that purchasers of Zillow Group, Inc. (NASDAQ: Z, ZG) securities between August 7, 2020 and November 2, 2021, inclusive (the “Class Period”) have until January 18, 2022 to seek appointment as lead plaintiff in Barua v. Zillow Group, Inc., No. 21-cv-01551 (W.D. Wash.). Commenced on November 16, 2021, the Zillow class action lawsuit charges Zillow and certain of its top executives with violations of the Securities Exchange Act of 1934. Two similar lawsuits, captioned Silverberg v. Zillow Group, Inc., No. 21-cv-01567, and Hillier v. Zillow Group, Inc., No. 22-cv-00014, are also pending in the Western District of Washington.
If you wish to serve as lead plaintiff of the Zillow class action lawsuit, please provide your information by clicking here. You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at firstname.lastname@example.org. Lead plaintiff motions for the Zillow class action lawsuit must be filed with the court no later than January 18, 2022.
CASE ALLEGATIONS: Zillow is a real estate company that purports to offer customers “an on-demand experience for selling, buying, renting or financing with transparency.” Zillow’s “Zillow Offers” business “buys and sells homes directly in dozens of markets across the country, allowing sellers control over their timeline.”
The Zillow class action lawsuit alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose that: (i) despite operational improvements, Zillow experienced significant unpredictability in forecasting home prices for its Zillow Offers business; (ii) such unpredictability, as well as labor and supply shortages, led to a backlog of inventory; (iii) as a result, Zillow was reasonably likely to wind down its Zillow Offers business, which would have a material adverse impact on its financial results; and (iv) consequently, defendants’ positive statements about Zillow’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On October 4, 2021, analysts from RBC Capital Markets lowered their price target for Zillow, warning that Zillow Offers would likely miss quarterly expectations. On this news, the price of Zillow Class A and B shares fell.
Then, on October 18, 2021, Zillow announced that Zillow Offers suspended signing of new contracts through 2021 and would focus on its current inventory, citing a “backlog in renovations and operational capacity restraints.” Zillow claimed that “[p]ausing new contracts will enable us to focus on sellers already under contract with us and our current home inventory.” On this news, Zillow’s Class A and Class B share prices fell by more than 9%.
Thereafter, on November 1, 2021, media outlets reported that, pursuant to a detailed analysis by KeyBanc Capital Markets, most of the homes Zillow Offers inventory were now worth less than Zillow paid for them, and that Zillow was looking to sell off 7,000 homes. On this news, the price of Zillow Class A and B shares fell.
Finally, on November 2, 2021, Zillow announced that it would wind-down Zillow Offers because “the unpredictability in forecasting home prices far exceeds what we anticipated and continuing to scale Zillow Offers would result in too much earnings and balance-sheet volatility.” As a result, third quarter 2021 financial results included “a write-down of inventory of approximately $304 million within the Homes segment as a result of purchasing homes in Q3 at higher prices than the company’s current estimates of future selling prices.” Moreover, the “company further expects an additional $240 million to $265 million of losses to be recognized in Q4 primarily on homes it expects to purchase in Q4.” The “wind-down is expected to take several quarters and will include a reduction of Zillow’s workforce by approximately 25%.” On this news, Zillow’s Class A share price fell by an additional 23% and Class C share price fell by an additional 25%, further damaging investors.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Zillow securities during the Class Period to seek appointment as lead plaintiff in the Zillow class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Zillow class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Zillow class action lawsuit. An investor’s ability to share in any potential future recovery of the Zillow class action lawsuit is not dependent upon serving as lead plaintiff.
ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 lawyers in 9 offices nationwide, Robbins Geller Rudman & Dowd LLP is the largest U.S. law firm representing investors in securities class actions. Robbins Geller attorneys have obtained many of the largest shareholder recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig. The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for recovering $1.6 billion for investors that year, more than double the amount recovered by any other securities plaintiffs’ firm. Please visit http://www.rgrdlaw.com for more information.
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Robbins Geller Rudman & Dowd LLP
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J.C. Sanchez, 800-449-4900