Since the beginning of the 2016 financial year the share price of leading online real estate classifieds advertiser REA Group Limited (ASX: REA) has soared 34%.

That’s an outstanding performance in its own right but particularly when considering the generally downbeat mood of the market which has seen the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) slip around 5% over the same period.

Here are three contributing factors which could explain why investors have been driving up REA’s share price.

1. The recent interim results of REA were impressive.

  • Revenue jumped 20% to $315 million
  • Net profit and earnings per share both surged 28% to $121 million and 91.9 cents per share (cps) respectively
  • Earnings before interest, tax, depreciation and amortisation (EBITDA) margin increased by 4% points to 59%
  • The fully franked interim dividend was increased by 22% to 36 cps

2. Overseas growth pipeline strengthening.

  • The acquisition of Asia-focused portal iProperty Group has recently completed and adds an attractive growth stream to REA’s operations. The expanded Asian operations complement the growth potential of REA’s European operations and US strategic investment in Move Inc.

3. Strong operating metrics reported for the six months ending December 31.

  • The group reported a 27% increase in average monthly visits to its Australian residential property portal and remains the clear leader based on property listings, site visits, page views and consumer engagement.

REA is one of a niche group of ASX-listed businesses which have cornered their respective online marketplaces. While REA is the leader in real estate classifieds, SEEK Limited (ASX: SEK) is the leader in employment and Carsales.Com Ltd (ASX: CAR) in automotive.

The attractiveness of their business models has led to these three stocks trading at a significant premium to the wider market. A premium is certainly justified, however, investors considering acquiring shares do need to be vigilant to not overpay.

The technology that's going to REPLACE the Internet is already here...

Dollar for dollar, insiders are calling it one of the biggest new markets in the history of modern business... NOW is the time to get in on the hush-hush industry that could be poised for growth of over 4,463%+ by 2020... And the 1 ASX stock that stands to grow YOUR money right alongside it! Simply click here to learn its name.

HOT OFF THE PRESSES: Motley Fool’s #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our https://www.fool.com.au/financial-services-guide">Financial Services Guide (FSG) for more information.

Motley Fool contributor Tim McArthur has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.