Zillow Group (ZG) Q1 results' optics were somewhat mixed, with a few positive indicators including rental income beating consensus, marginal residential growth and a new $1 billion stock repurchase plan, RBC Capital Markets said in a late Wednesday research report.

RBC said that the company is still expecting a low-to-mid double-digit full-year revenue growth despite cross-currents in the housing market. The brokerage noted that the company seems unconcerned with any risk to its deal with Redfin (RDFN), which went live in April, due to Redfin's acquisition by Rocket (RKT). The company expects the deal to create further momentum over time.

"We believe the opportunity to take share from competitors is substantial, and likely a multi-year journey, RBC said.

The new $1 billion stock repurchase authorization indicates management's confidence, RBC said.

However, RBC noted that the company's Q1 residential income coming in just above the consensus and a reduction in Q2 residential income guidance will "catch some people's attention," RBC said.

The brokerage also said that the company's full-year 2025 outlook, which potentially implies less, little or no residential growth, together with bigger EBITDA guidance reduction, "will likely bring down Street estimates a bit more sharply-than-expected."

RBC has an outperform rating and a $88 price target on the stock.

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