A rare opportunity to buy 1 of Australia’s top shares?

The REA Group Ltd (ASX: REA) share price has been one of the hardest-hit S&P/ASX 200 Index (ASX: XJO) shares over the last few months. Since August 2025, it’s down around 37%, at the time of writing, as the chart below shows. That’s a big hit for one of Australia’s top shares.

This business is the owner of a number of impressive real estate-related businesses including realestate.com.au, realcommercial.com.au, PropTrack, flatmates.com.au and Mortgage Choice. It also has international investments including Indian and US real estate portal businesses.

I can see why the REA Group share price has fallen so much recently – artificial intelligence (AI) could lead to dramatic impacts to certain software businesses and REA Group could be caught up in that.

Plus, there is attention on the business with invigorated competition from Domain under new ownership. There’s also greater attention and pushback on realestate.com.au’s price increases.

It’s rare to be able to buy one of the ASX’s leading growth shares at such a discounted price.

Is this an attractive REA Group share price?

Broker UBS suggests that the “sell-off appears overdone as [the] AI narrative continues to dominate”.

UBS said while concerns are “valid”, it’s not seeing any meaningful evidence in the recent FY26 half-year result.

The broker said the valuation is attractive for a stock that’s continuing to deliver “resilient double-digit earnings growth” and it also called it the most AI defensive business of the online classifieds space.

In that result, the business reported buy yield growth of 14%, net profit growth of 9%, a dividend hike of 13% and a share buyback of up to $200 million.

REA Group is looking to utilise AI within its business to support the customer experience. UBS wrote:

Company commentary suggests while AI spend is increasing, it is a “new tool” to help optimise customer experience and substituting existing tech spend, rather than adding incremental pressure on costs growth.

Why is this one of Australia’s top shares to buy today?

UBS believes the business can deliver further yield growth and bigger profit margins, despite competitor discounting. This is a promising sign for the REA Group share price, in my view.

The broker said:

We remain confident on REA’s ability to achieve positive jaws in 2H26e due to less lumpy marketing and better listings environment as we cycle weaker comps (UBSe 2H26e +2.6%). Macro remains key risk into 2H, with another 1-2 RBA rate hikes pencilled in by our economics team, but this could drive upside risk to volumes as mortgage stress drives more stock to market.

We remain confident on REA’s ability to deliver double digit yield growth over next 3 years (UBSe +13%). For FY27e, we see a likely mid to high single digit price rise in FY27e plus mid single digit contribution from further penetration of Amax and Luxe. This is despite potential discounting behaviour from competitors.

Analysts are still expecting the business to deliver price rises in the coming years and it’s not actually worried by competitors or AI because REA Group still drives significant buyer leads and it has the biggest audience. Additionally, AI currently remains a very small part of REA Group traffic:

Industry feedback suggests REA still delivers largest number of buyer enquiry leads to agents, driven by continued growth in audiences (146.1m avg monthly visits in 1H26, vs 132.2m in FY25). Management noted traffic from AI remains <1% and recently declined (although early days), further suggesting strength in direct eye-balls to platform.

Using the forecast from UBS, the REA Group share price is valued at 35x FY26’s estimated earnings.

The post A rare opportunity to buy 1 of Australia’s top shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.