Citadel Moves Into Zillow

According to a recently disclosed filing with the Securities and Exchange Commission (SEC), as of Nov. 19, Citadel Investment Group owned 1.6 million shares of Zillow (Z), a real estate website, which is best known for its "Zestimate" of property values based on a proprietary formula. This gives Citadel, which is managed by billionaire Ken Griffin and his team, more than 6% of the total shares outstanding. The fund's 13F filing shows that it owned about 440,000 shares of Zillow at the end of September, indicating that Citadel bought more Z shares in the last two months.

Zillow went public in July 2011, trading between $30 and $35 per share in the days after its IPO. Its stock price rose 82% in the first nine months of 2012, but plummeted in early November after the company reported that its internal estimates of revenue for the fourth quarter were below analyst expectations. Zillow currently trades at 150x trailing earnings, so any indication that its growth trajectory is slower than previously expected tends to have a powerful effect on the stock price. Griffin and his team seem to have taken the pullback as a signal to start buying....476 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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