On Thursday, Trulia hosted a well-attended analyst day in San Francisco. A number of Trulia executives spoke, including Chief Executive Officer Pete Flint, Chief Financial Officer Sean Aggarwal, Chief Marketing Officer Kira Wampler, and President of Market Leader Ian Morris.

During the analyst day, Trulia detailed its previously announced $45 million 2014 marketing plan, including what drove the company to announce the plan, the primary advertising channels it will invest in, and why Trulia believed $45 million was an appropriate amount of spending. Trulia also reiterated the value proposition its advertising product and Market Leader CRM provides to agents. The company outlined its opportunity in tangential markets, framing that the builder market and the rental market could each be $100 million to $200 million revenue opportunities for Trulia over the next five years.

In addition, Trulia disclosed its revenue from mortgage lenders was at a $20 million annual run-rate as of the end of the fourth quarter. Finally, Mr. Aggarwal showed the relative comparisons of Trulia’s key financial and operating metrics with close competitor Zillow (Z $84.09). He pointed out while the financial and operating metrics are at relatively similar levels, the valuation difference (as measured by market capitalization) was relatively large.

Following the analyst day, we reiterate our view that the underlying fundamentals of Trulia’s business remain strong, and believe that Trulia should continue to benefit from the rollout of its inventory expansion program and potential price increases in 2014 and beyond. Further, with the addition of Market Leader, Trulia now has a base of nearly 60,000 premium agent subscribers to which it can upsell and cross-sell products. Given these factors; the potential to monetize the adjacent rental, mortgage, and builder markets in coming years; and the continued housing recovery, we expect shares to outperform.

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