Will Seek and REA Group shares beat the market over the next year?

Can their strong performance of the past 12 months be repeated?

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Key points

  • Macquarie rates Seek as outperform with a price target of $32.50. 
  • While residential listings have declined, Macquarie projects a 1% growth in listings for FY26 for REA Group. 
  • Both stocks are projected to surpass the historical market average of 9.3% growth, with Seek favoured as Macquarie’s top online classifieds pick.

Seek Ltd (ASX: SEK) and REA Group Ltd (ASX: REA) shares have both beaten the market over the past 12 months.

Seek acts as a marketplace, providing an online platform that connects job seekers with employers. Meanwhile, REA Group operates Australia's leading residential and commercial property websites, including realestate.com.au.

Both Seek and REA Group shares have risen 20% in the past year, compared to a 9% increase for the S&P/ASX 200 Index (ASX: XJO) over the same timeframe. 

But, how about the next 12 months?

Macquarie recently analysed data related to Seek and REA Group shares. Let's find out whether they could beat the market from here.

Strong data supports further gains for Seek

According to Macquarie, the SEEK employment report for August 2025 showed a 1% increase in Australian job ad volumes from the prior month, but they were down 3% from a year ago. 

Quoting Dr Blair Chapman, Seek Senior Economist, Macquarie noted, "August is traditionally the month when job ads peak in Australia… even after adjusting for these seasonal shifts, ad volumes rose 0.8% m/m."

Macquarie said Seek remains its top classifieds pick. The broker believes "FY26 guidance is conservative and with ongoing execution (i.e. product innovation / pricing, cost controls / operating jaws, Asia strategy and SEEK growth fund redemptions) supporting a re-rating".

Macquarie has an outperform rating and a price target of $32.50 on Seek shares. Given that shares are trading at $28.72 at the time of writing, this suggests a nearly 15% upside from here, including capital gains and dividends. 

Seek currently offers a dividend yield of 1.60%.

Data appears a mixed bag for REA Group

Macquarie also recently reviewed Australian residential listings volume for August 2025. 

Australian residential listings volumes fell 12% in August compared to last year, with major cities Melbourne and Sydney declining 12% and 7% respectively. 

Macquarie is forecasting 1% Australian residential listings growth in FY26 for REA Group. This is slightly ahead of management's flat guidance. Macquarie cited the impact of rate cuts for this slight deviation.

Commenting on how this data and other factors may impact REA Group shares, Macquarie said:

Overall, while we are constructive on REA to deliver mid-teens EPS growth over the medium term (+16%, three-year CAGR to FY28), which is more so supported by Australian buy-yield (price + depth) rather than listing volumes, we have some caution from competition, with CoStar having completed the acquisition of Domain in August 2025. Whether the competitive dynamic changes, only time will tell, and may impact REA's valuation, with it trading on 45x 12-months forward P/E.

Macquarie has a neutral rating on REA Group shares and a price target of $255. 

Given that shares are currently trading at $228.90, this suggests nearly 13% upside from here, including capital gains and dividends. 

REA Group shares currently offer a dividend yield of 1.1%.

Will they beat the market?

Macquarie provided no projections for the market in its reports. However, according to the Vanguard Index Chart 2025, the Australian share market has increased at an average annual rate of 9.3% over the past 30 years. Using this average and Macquarie's forecasts, both Seek shares and REA Group shares will beat the market for those who buy shares today. It's also worth noting that Macquarie has a clear preference for Seek over REA Group, naming it its top online classifieds pick.

Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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