“Although we do expect investors will perceive an increase in competitive intensity in the coming months, we believe that from an operational standpoint little will change, and that Zillow’s (Z) assets and content should allow it to compete effectively against other industry players,” Canaccord Genuity e-commerce analyst Michael Graham said.

He cited the possibility of multiple expansion and three revenue upside opportunities:

1) Pricing power in Premier Agent (2012) [allowing agents to target their marketing on a zip code level]

2) Zillow Mortgage Marketplace (late 2012-2013) [borrowers and lenders come together in an open, anonymous, and free marketplace]

3) Rentals (late 2013-2014) [utilizing an estimated monthly rent price, known as a Rent Zestimate]

Mr. Graham reiterated his BUY rating and $42 price target.