Motley Fool Australia

4 reasons why you should own REA Group Limited

REA Group Limited (ASX: REA) has announced it will be launching a smartwatch app for property hunters. The Apple Watch app, due out in April, will allow users to find properties for sale, literally, with GPS directions, and make audio notes about homes as they inspect them.

The operator of the market-leading property listing website has been an innovator for many years. In the company’s media statement, Chief Product Officer Henry Ruiz said, “Our product philosophy is to be on all devices that people use in their property search, to make their journey simple, efficient and stress free. Increasingly, that means on-the-go and wearable technology.”

REA Group already has a popular mobile app for property searches, which has 4 million downloads. People are on the go more and having a better way to locate listed properties immediately around you could help property sales.

It will probably help real estate listing numbers and revenue for REA Group. Giving users yet another good reason to use can help maintain and maybe even grow market share. The stock has been a fast grower for a number of years. Analysts forecast earnings to grow in the high 20s on average annually over the next several years.

Other reasons REA Group is a standout company are:-

strong dividend growth because the company pays out about 50% of earnings per share, so if earnings are rising quickly, so are dividends. Dividend payments have doubled since 2011,

return on equity and net profit margin around 35% were achieved in financial year 2015, and

no long-term debt because the company makes ample profits to cover operating expenses and investments.

REA Group is also expanding into the US property market together with joint venture partner, Rupert Murdoch’s News Corp, through the recent acquisition of Move Inc, the third largest property advertising website operator.

I think REA Group could continue as a high-growth company, making it the kind of stock investors would like to have in their portfolio.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

Motley Fool contributor Darryl Daté-Shappard does not own shares in any company 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 policyThis article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Related Articles…