REA Group Ltd (ASX: REA) shares have fallen further into the red in Tuesday morning trade.
At the time of writing, the shares are down around another 2% and are changing hands for $133.12 a piece.
Today’s drop is the latest of a long string of share price declines.Â
In fact, REA shares have suffered a gradual but relentless downturn since the company announced the appointment of a new CEO in August last year.Â
REA shares dropped from above $260 in August 2025 to around the $150-range by March 2026. And now they tumbled even further.
The shares are now down around 28% year to date and roughly 43% lower than this time last year.
What has happened to REA shares?
REA was previously one of the more expensive stocks on the ASX. It was supported by strong profits, its dominant position in online property listings, and a robust property market.
Investors were expecting years of strong growth. But indications that the Reserve Bank would begin another interest rate hike cycle in late 2025 saw many investors shy away from the high-growth property share.Â
Rising rates, softer lending demand, and concerns about tax changes affecting property investors have led the market to forecast weaker house prices and transaction volumes.Â
Given REA earns a significant portion of its revenue from property advertising, analysts and investors are concerned that a weaker housing market will translate to fewer homes for sale and therefore a lower advertising spend. This directly affects REA’s bottom line.
The company’s latest financial results haven’t helped either.
REA reported robust second-quarter FY26 results in early February. But the figures came in short of market expectations, and investors were spooked.Â
The company’s third-quarter results update in early May was a little more optimistic. But the small share price uptick was short-lived and quickly followed by huge losses.
Is there any chance of a rebound ahead?
Analysts are divided on their outlook for REA shares, but it looks like they mostly agree we’ll see some upside ahead.
Market Index data shows that the majority have a hold rating on REA shares. But after the latest share price slump, the average $181.20 target price now implies an upside of around 36%, at the time of writing.
Over on TradingView data, analysts are a little more positive. The majority (nine out of 16) have a buy or strong buy rating. Another six rate the stock as a hold.Â
The average $198.12 target price implies a potential 48% upside over the next 12 months, at the time of writing. However, some are tipping the share price to rocket another 86% to $249 a piece.Â
The post REA shares fall 43% to a three-year low. Is it time to buy? appeared first on The Motley Fool Australia.
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Motley Fool contributor Samantha Menzies 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.