Zillow Stock Predictions: An Algorithmic Analysis (Z)

Zillow Stock Predictions

I Know First supplies financial services, mainly through stock forecasts via their predictive algorithm. The algorithm incorporates a 15-year database, and utilizes it to predict the flow of money across 2000 markets. The self-learning algorithm uses artificial intelligence, predictive models based on artificial neural networks, and genetic algorithms to predict money movements within various markets.

The algorithm produces a forecast with a signal and a predictability indicator. The signal is the number in the middle of the box. The predictability is the number at the bottom of the box. At the top, a specific asset is identified. This format is consistent across all predictions. The middle number is indicative of strength and direction, not a price target. The bottom number, the predictability, signifies a confidence level.

Explanation template for Z

I Know First published a bullish article on Zillow Group, an online provider of real estate solutions, on Seeking Alpha. Having explained how I Know First’s algorithm works, it is worthwhile to see if the algorithm agrees with the bullish fundamental analysis of the company. The three-month and one-year forecasts for Zillow are included.

Zillow Stock Predictions

(Figure 1: August 12th Forecast)

Zillow was the algorithm’s top stock pick for both time horizons for the August the 12th forecast. The signal strengths are both exceptionally strong, especially for the one-year time horizon. The predictabilities are also impressive, indicating that the algorithm has had success predicting the movement of the stock price in the past.

The bullish fundamental analysis makes sense considering the company’s integration of Trulia will be completed by the end of the year, and Zillow’s fantastic revenue growth demonstrated by the latest quarterly results. A continuous growth in unique visitors to their websites combined with continued growth in mobile and the ability to add more MLS listings in the future due to its increased size and scale, the company will offer solid returns during the rest of 2015 before taking off in 2016.