저자: Kevin · 외국인
요약 보기
케시 우드가 질로우(Zillow)를 11월 초 매수 후 실적발표 후 대량 매도한 점을 분석. 질로우의 주택 매입(Zillow Offers) 사업 중단은 가격 예측 실패와 경영 역량 부족 때문이라 주장. 질로우 IMT·모기지 사업은 수익성이 높으나 광고비 부담과 에이전트 광고 모델 변화가 우려. 케빈은 질로우에 대해 부정적이며 케시의 매도를 잘한 결정이라 평가. 지난 발언은 예측이 아니므로 대상 자산 중 명시적 1~3개월 방향 예측은 없음.
다듬은 글
this video is brought to you by exp real estate go to medkevin.com exp to learn how you can become an exp real estate agent earn stock in the company and make max commissions while being part of a virtual brokerage met kevin.com exp hey everyone meet kevin here so i'm a kathy wood loyalist however i don't agree with everything she says while i might agree with most and i highly admire her and respect her opinion there are definitely some things i disagree with and i wonder if kathy wood just made a big faux pas or if she's doing the right thing of course in this video we're talking about zillow and the fact that kathy wood bought zillow only to sell it a day later for substantially less consider this on november 1st none of kathy wood's funds bought zillow despite being down eight percent and kathy generally being a by the dip buyer then november second came right before earnings and zillow did not make any announcements yet about ending their home buying business and instead i made a video on zillow talking about why it was likely that they were pausing their home buying business and therefore liquidating 7 000 homes i blamed what i believed was management incompetence at zillow and ultimately a failure to train employees here's a clip when i suggested this was exactly what was likely going on and if you hire new people to try to value real estate you're going to get unconscious incompetence that people don't even know that they don't know they're getting bad deals and that is the perfect way to bankrupt your company this is very bad for zillow the next thing that's going to happen is they're either going to have to train this workforce properly or they're going to have to fire or lay off thousands of people that they just hired and it is a sign of management and competence i am concerned that the executives at zillow do not know how to flip homes honestly i i would wonder if any of them have ever personally fled properties i'm not gonna bother looking it up because it really doesn't matter the proof is in the pudding they don't know what they're doing zillow then subsequently announced that they were shutting down their home buying business completely and laying off 2000 individuals but is this why kathy sold or is it something else because take a look at what kathy did and then we'll speculate on potentially why she's bailing out of this investment that same day before the market closed zillow fell another 11 percent and then as expected kathy woods by the dipping came in and we saw kathy wood buy 288 813 shares in arc k her innovation fund then earnings came out and after earnings came out kathy woods sold two million eight hundred fifty eight thousand two hundred sixty eight shares of zillow in rk six hundred forty eight thousand in ark w the next generation etf 394 thousand shares in arc after fintech etf then the very next day sold another 1.329 million shares of zillow in rk along with 462.2 000 in arc w it's clear now that despite the fact that she bought the dip before earnings she sold and essentially liquidated zillow after earnings so what happened at earnings well first let me show you my reaction of what earnings went down like oh zillow tanking another nine percent oh dang they're getting robbed they deserve it whoa what zillow shuts down home flipping business wait wait wait wait wait wait what oh they just they they're canceling it they're not doing eye buying anymore it's even worse than expected oh oh it's it's a bloodbath uh because remember they paused home flipping oh my god i called it i freaking called it holy crap i did a video this morning i'm like there's they hired so many incompetent people they're gonna have to fire these people holy crap the headline just came through zillow to shut her home buying business and lay off 2 000 employees oh that's horrible for those people but it just shows you real estate's not easy okay now this is somewhat going to be my speculation but i'm going to give you my thoughts on whether or not i think kathy would make made a mistake here or if she's doing the right thing and to understand this a little bit better we're going to look at some select items of zillow's earnings call and zillow's investment financial report their q3 their calendar q3 financial report so let's go ahead and take a peek at exactly what those look like so first this is the transcript of the earnings call and it's worth noting a few things first we're going to begin at the beginning here there we go it's worth noting a few things first zillow management deemed that scaling up zillow offers which was their eye buying program where they would offer to buy individuals homes and then fix them up and resell them was too risky too volatile and too risky for earnings for the company which makes sense because this company lost money hand over fists trying to flip homes this is one of the reasons in my real estate investing course i highly discourage property flipping it's a very low margin business you have very low insulative wedge and given the fact that you have to pay high selling fees because real estate is illiquid it takes a special expertise to make sure that you don't go over budget and it is very difficult to get out profitably from while maintaining your standards and doing things within the scope of the law which means pulling permits and doing things with licensed contractors almost impossible to flip in those sorts of conditions especially since you got plenty of do-it-yourselfers competing with you but anyway zillow argues that there's too much of a low return on equity and therefore for the purposes of the company they're going to stop doing i buying which is where again they buy homes they make people offers directly and then they buy homes and then they sell them they mention that they wanted to become a market maker not a risk taker and i'll tell you that any real estate agent could have told zillow that there's no way they were going to become a market maker like a citadel of the world in real estate when you have to consider that in america we sell six to seven million properties every single year zillow at peak was handling maybe seven four to seven thousand purchases per quarter which annualized even if we took the generous number of seven thousand times four that would be under 30 000 homes a year even if you 10xed it you'd still only be buying 300 000 homes out of a six to seven million transacted home market there's no way you're going to become a market maker you're someone overpaying for properties because you've failed to educate your employees on how to properly value properties it's the big problem right but anyway zillow makes the excuse that zillow offers went through a period of extraordinary circumstances like the freezing of the housing market which i i put a er here because i'm like really like the housing market didn't really pause much i mean there was maybe like a month of uncertainty and then real estate was off to the races in april of 2020.
supply and demand imbalances have led home prices to rise at a rate that was without precedent well wait a minute rising home prices are good for flippers if you buy a home for today's price you sit around for three months and do nothing you should be able to make money i literally did that i still got to make a video on this property i bought a property for for 970 000 i literally did nothing to it nothing i was trying to i was trying to get paperwork through the city and it was a disaster so i decided to sell the property and i sold it for 1.13 million dollars so i sold it for 160 000 profit doing nothing so when zillow here says that we've been unable to accurately forecast future home prices at different times in both directions by more than we model possible i begin to question management's competency beyond the fact that i already questioned management's competency when they hire two thousand people without properly educating them on how to value real estate folks it's not that freaking hard i have a course that teaches it but you don't even have to go buy that if you don't want to you'll learn a lot in it but i'm just saying it's not that freaking hard to value real estate you look at the comps and don't overpay for crap don't use cost per square foot on single family homes you got to use proper comps i could get into a different video on this but to me it sounds like the management here is complaining that oh we we failed at flipping homes because we couldn't predict what prices were going to be in six months well folks for the last three four years that you've been doing zillow offers i could tell you what home prices have been three to four months from now up they've been up so the fact that you're complaining that you weren't able to accurately predict the future value of homes is a cop-out it's and i think management is literally showing they're incompetent here because really what they should be saying is we effed up we overpaid for homes we went and paid more money for properties than what the properties were worth and now we're sad because we're incompetent and we're losing money that's what the real management is that you have at zillow now don't worry we're going to get into some more detail here about the other aspects of their business and then we're going to talk about whether or not kathy wood made a mistake so uh they talked about because of price forecasting volatility we also had to reconsider what business would look like look to me this is a bunch of bologna okay it's a bunch of bologna so let's now talk about the business that's surviving some of the other aspects going on and then talk about cat if he made a mistake so zillow mentions that over the investment period they expect their internet media and technology business to increase substantially in fact later in this earnings report we'll see that their imt business is expected to grow by about 13 to 14 per year this is the part of their business that's actually profitable in fact let's go ahead and look at just that so if we jump in over here we're going to see that homes revenue which is right here this 1.186 billion is obviously much less than the homes cost of 1.422 billion that's because they already started taking write-offs and losses on some of the homes in this last quarter that's because they're starting to liquidate them but ignore that for a moment instead look at what i've highlighted in green this is imt you're going to notice that 480 million dollars of revenue is actually only matched with cost cost of goods sold of 51 million dollars that means they have an 89.3 profit margin on imt that's a really smart business in fact one of the things that i recommend to anybody who ever wants to start a business is if you're going to start a business you better get into a high margin business if you get into a low margin business you are going to get reamed you're going to get destroyed and you're going to fail and look even zillow failed look at the next segment they have 70 million dollars of revenue for mortgages this is smart why is it smart because it's a profitable business and they their cost of goods sold or 21.7 million that is a 69 profit margin that's very very good on the left right here these are profit margins and these are what i call expense ratios so they're spending 10.7 cents for every dollar on imt of revenue they're getting and they're spending 31 cents for every dollar of mortgage revenue that they're getting okay good let's remove some of the blue here and move on if we now look and scroll down a little bit at their future forecasted earnings and i used a consensus from bloomberg analysts to project this we expect zillow to have somewhere around a four dollar earnings per share in 2025.
if in 2025 they have about a four i think it was four dollars and thirty cents eps then their future pe at today's stock price around 65 64 wherever it is right now 66 dollars is somewhere around 15.3 and if we divide that by an approximate assumed growth rate of 15 we get a peg ratio that's near one this is actually really good this is what you want to see when you're investing in in a company you want to see a high growth rate that matches some form of a future p e ratio where it makes sense uh to to invest in a low peg company so another example of this might be tesla very high future pe but massively high growth rates for example tesla has a future pe of about 60 but it has a compounded annual growth rate expected of about 50.
that's pretty close to one you want to be as close to one as possible google is similar to this very low peck apple on the other hand has a relatively high uh valuation so the top number's high and the bottom number is lower which makes the peg ratio much higher basically is a way of saying that you're paying more per value of growth at apple than than maybe uh what you could get at other companies anyway enough talk about other companies when we look at zillow's core business they have profitable business models however they did spend 294 million dollars right here is that line on sales and marketing and that's a little bit of an issue because out of the 550 million dollars of revenue 300 million going to marketing is a lot so zillow's going to have to figure out if they want to continue to grow at a 15 pace and actually get to four dollars in earnings per share they're gonna have to figure out how to spend less money advertising and more money focusing on their and figure out how to get more revenue in to their core competencies this could be slightly difficult now i do expect advertising expenses to go down because i suspect a lot of this advertising was spent on the home business it's trying to attract sellers for their home business but if this advertising item here goes down how much are we going to see these upper businesses here mortgage and imt go down as well and that remains to be seen there's a lot of uncertainty with how resilient do these two segments of the market are going to be without zillow homes now we expect it'll be much like it was in 2018 or 2019 before home revenue was really coming in and look there the company was actually doing decently it was growing its imt it hadn't started mortgages yet but its imt was growing and there was potential however i do have some concerns about how the company is trying to get revenue through their imt business see back in the day when agents used to advertise on zillow premier agents by the way are the one of the biggest ways that zillow makes money these are real estate agents who are trying to find buyer and seller leads right this is a very high profit margin business as well but anyway this particular business is is very profitable and real estate agents will pay to have their information listed on zillow and back in the day you used to go to zillow.com and you would pick uh a property web or whatever property link and you would be able to see three or four different agents that you could then click on their pictures of and then contact that agent to get information on the property now you actually don't see any agent ads up here anymore all you see are these buttons for contact agent and take tour so if i click contact agent i just throw in my information blindly here and i have no idea where this is going i don't know if this is going to the listing agent to an agent that's pictured but there's no agent picture the same thing with take tour i have no idea who this is going to and that's because zillow is trying a new model and this is what you're investing in if you're interested in zillow they call it zillow 2.0 it's kind of like uberizing real estate think about going to uber on your phone and clicking i need a ride to get from point a to point b you don't really care who the driver is you don't really care what they look like you don't care what their personality is what their expertise is what kind of car they're driving is when you use a regular uber you just care to get from point a to point b unfortunately in my opinion that does not work in the real estate business zillow is trying to uberize contacting agents and what they're doing is if you fill your information into this form they will automatically send it to an agent they deem who pays them by the way they deem to have a high response time high reliability and is somebody who's able to drop everything and go show you the property now they will if you scroll down further if you go past all this junk and you get all the way to the bottom of zillow over here they do pay homage to some of the old school zillow tactics that they had i'll hide myself here for a second and this is where look your personal guides get to know the neighborhood find an amazing local agent to set up tours give advice and negotiate with sellers this is how real estate should be done people should find an agent that they believe is a professional whom they believe that they can actually uh you know work with have a connected personality with and is going to be somebody who's going to look out for their financial interests because a real estate agent is much more than somebody who's just trying to find you a home dude everybody can find a home finding a home is not that big of a deal right now but you've got to have an agent who's going to look out for you get the proper inspectors to make sure they're a second set of eyes to advise you on on real estate financial situations there are a lot of things and i'm not saying that all real estate agents are great don't get me wrong we can make a whole video on that but i have a lot of faith that a good real estate agent can make somebody a lot of money i know this is true and of course a bad real estate agent can lose people money right but the point is if you're investing in zillow you are investing in these people wanting to advertise on zillow as a premier agent so if i click on this person they are not listed as a premier agent they are not advertising so you can actually go through different areas here different regions and see who's advertising see this person zillow premier agent this person is paying porchlight realty team powered by exp that's funny which by the way if you want to join exp if you're a real estate agent go to medkevin.com exp that's metkevin.com exp and you can sign up to join exp realty which is a really awesome way for you to maximize your commissions and be part of the largest and fastest growing virtual real estate brokerage nobody needs an office anymore it's really cool my wife has her license with exp and it's awesome so medkevin.com i also invest in the stock for what it's worth it's really cool you also get stock rewards at a discount if you're an agent at exp so mattkevin.com exp but anyway back to zillow so you can see if somebody's a zillow premier agent now this person it probably makes sense to be a zillow premier agent because if somebody fills out that contact form on the property website this person's got a whole look at this 77 members he's got a whole freaking office of people who could respond tons of people here without reviews i don't even know if these are real people but i mean emma hi emma you're caitlin tiffany these these they look like very nice people who want to take care of you as well as randall and nade and these other folks as well alex rebecca right just saying like there are a lot of people oh my gosh who were really uh apparently ready to help this person sell real estate which which is great uh and that's sort of that uberization of real estate right and so the question is do you think that this is a better model of advertising or is it better for somebody like what what is what would you rather do is do you just want somebody to unlock your door for you if you're looking for a real estate agent you want to get assigned a random uber style real estate agent or are you going to go to yelp go to san diego and type in real estate agents and are you going to scroll through people's profiles and their expertise and what they say and try to determine who's right for you is it going to be arlo is it going to be mike and jess how about bruce or daniel beer dude that guy's last name money uh colleen whatever right here you could pick jake if you want somebody without a picture or are you going to pick kimberly i don't know maybe you're going to pick kimberly schmidt or you know chemo who's who's half covered by an open house sign i don't know but the point is oh there should be ads on here as well yeah uh i think these are ad oh sponsored results i think i'm not sure they actually make this a little difficult special offers free i think these are the agents who advertise so arlo must advertise and he's also no he's the sponsored result they make it actually extremely difficult to tell which one is sponsored and which one's not i think they do that on purpose i'm guessing it's these three anyway the point is i personally think having a full disclosure having been a real estate broker for 11 years that i would much rather advertise myself on something like yelp where i can show off me my videos the services that i do the education that i can offer somebody rather than just being some scumbag who's going to answer the phone to any rando who calls in on zillow you could go oh oh yep you want to see that house yep oh i'll travel it over like i'm not a door opener as a real estate broker now i don't do real estate sales anymore so i'm not trying to minimize uh the importance of somebody going to open the door for you and individuals having the opportunity to have the door open quickly for them redfin does that model as well and i invest in in redfin but the point is in my opinion you when you when are investing in zillow you are not investing uh in the next six months which are going to be a disaster because they're going to be liquidating these properties between now and the second quarter of 2022 maybe the first quarter of 2022 so you're really not going to see good profit again probably until the third quarter of 2022 which is fine if you're going to invest in zillow at the dip right now you need to know that but what you've got to understand is the advertising business that you are investing in has changed it's not the zillow that it used to be the zillow 2.0 in my opinion is less desirable for real estate agents to advertise with on top of that i thought zillow was very smart getting into making lease contracts for people and handling property management for people by allowing folks to pay to advertise properties on zillow for rent but take a look at this rental revenue also underperformed our expectations as we incurred headwinds related to high rental occupancy rates which tempered advertising in other words if stuff is flying off the shelf fast people don't got to pay for advertising you've got to ask yourself that about real estate agents as well i know a lot of real estate agents are looking for leads but is zillow going to be the high convert way to actually get those leads and so if you're an agent i'd like to hear from you what you think i've talked to a lot of agents about this and a lot of the agents i talk to don't like the transition that they're seeing with zillow now they're not trying to all in bag on zillow here but let me tell you this i'm very frustrated by a few things one i don't trust them i don't trust them because they're not being honest about why zillow offers failed zillow offers didn't fail because they couldn't crystal ball what future home values were going to be they're in an appreciating market it'd be one thing if oh the market crashed we got screwed it didn't the market boomed and you sucked you sucked during boom time like if you suck in a recession okay like that happens that's what bankruptcy's for you suck during boom time you just straight up don't care like that's bad anyway so when they suggest that their imt segment is going to grow at 13 year-over-year growth i'm actually not that excited about that i don't really care that you grew 50 from q4 2019 i don't care i want to know going forward and 13 isn't that great now has the stock been discounted to where maybe peg wise that makes sense sure peg ratio wise makes sense but you're still trusting in this management team to execute on that 13 growth rate otherwise they're going to miss now i do think they're going to have massive negativity between now and the middle of next year and they will grow again in the future zillow's not going to go away anytime soon so it's not like i think if you invest in zillow your money is going to go down the drain i personally do think there are probably better opportunities to invest in i'd much rather invest in the companies that i really do invest in big time which honestly in the real estate space expi real estate that is totally under looked in my opinion in the real estate world redfin in my opinion is a better option than the zillow thing here because rather than trying to uberize real estate agents redfin actually trains their agents because they hire their agents and they use agents in-house so they actually have training protocols rather than just using any random real estate agent out there so i don't know if you can trust their guide which is a concern of mine i really don't care about the showing time platform that they keep talking about i don't care about 3d scans look i love 3d scans i love matterport but i don't think it's like a profitable driver of growth for zillow i do think their mortgage business could be very interesting but look at this we expect mortgage segment revenue to be 47 million to 57 million which is down sequentially from q3 and it reflects slower industry refinance activity from recent moves and interest rates so their mortgage business is slowing down look other mls's are doing showing time platform crap like no nobody cares uh then here we go they reiterated again the co-founder and ceo we were fundamentally we have been unable to predict future prices of homes to a level of accuracy that makes this a safe business to be in wrong you're an idiot total idiot to say that or you're lying it's not that hard okay the real estate cycle does this that's what the real estate cycle does if you want to buy good deals you buy them below whatever the hell the market is doing this right here is called your insulative wedge okay so if a house is worth 500 000 right here and i can buy it for four hundred thousand dollars right here even if the market falls i'm still more insulated than the next guy i'm sitting in the toilet for less time than the guy who's buying it up here who's sitting in the toilet a lot longer he's underwater that much longer right that's why you want to buy wedge deals that's why i have a course on buying properties under market value and that's why i get very frustrated because i do feel very passionate about the real estate industry when you have a co-ceo or co-founder and chief ex and the ceo in my opinion lying about what the hell went wrong they effed up they didn't train their workers it's that freaking simple and it's not a 3d touring system that's going to make zillow any better of a company to invest in so with all of that said did kathy wood make a mistake dumping in my opinion the answer is no i think kathy did a wonderful thing here i supported 110 and i'd much rather take all the money out of zillow and plow it into something like nano dimension because i think they're equal yolos except nano dimension has way more upside okay just kidding i'm not going to actually invest in nano dimension it had a lot of momentum movement i know that kathy would invest in it i personally okay i've made many videos on intervention i'll give you very very quick i don't think that 3d printed circuit boards are going to reach any kind of mass manufacturing scale anytime soon that's what the ceo envisions i don't agree with that model i'm just making a comparison that i'd kind of rather be in something that i don't really like than zillow and again i'm not saying the stock price is not going to go back up i do think there's a lot of massive uncertainty and fear around this company right now i just don't like their business model i can't personally support them you might look at this and go uberization of real estate temporary pain perfect by the dip opportunity for me to get into the uberization of real estate then go make money i'm all for it i think the growth rate will be stunted but we'll see and we'll see how management executes those are my two cents stock doc to check out on those and make sure to go to mckevin.com exp to become an exp real estate agent
Comments 0