By Shaina Mishkin

One of the pressures weighing on Zillow Group's stock was lifted on Wednesday after Compass voluntarily dismissed its lawsuit against the real estate technology company. Zillow's shares were rising as real estate stocks and the broader market dropped.

Compass, one of the nation's largest brokerages, filed paperwork on Wednesday to drop its lawsuit challenging Zillow's rules surrounding the marketing of homes. Compass confirmed the move in a statement. Zillow didn't immediately respond to a request for comment.

Zillow stock was up about 2% in afternoon trading following the filing, while the Dow Jones Industrial Average was down about 1.3%. Litigation, including the lawsuit filed by Compass last summer, has been among the sources of pressure on Zillow stock, which is down about 32% this year.

Wednesday's gain adds to Zillow's 6.8% increase on Tuesday after it announced partnerships with several brokerages to syndicate premarket "coming soon" listings. The stock is up 8.8% over the past two days, its best two-day gain since November 2024, according to Dow Jones Market Data. Compass shares, which were down for most of Wednesday trading, were 4% lower in the afternoon.

"In a growing number of markets, the public cannot see premarket homes, including listings often referred to as 'coming soon,'" Zillow said in a release. Its change "brings these homes out of the shadows and into the daylight, making them publicly visible instead of confined to closed systems, while working within MLS [multiple listing service] frameworks and supporting brokers and agents in complying with local rules."

Zillow's listing changes are a "net positive" for the company "that could drive listings differentiation and subsequent traffic on its portal, and a better opportunity to monetize transactions holistically (including mortgage)," William Blair analyst Stephen Sheldon wrote in a note.

Write to Shaina Mishkin at shaina.mishkin@dowjones.com

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March 18, 2026 15:45 ET (19:45 GMT)

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