Zillow Group Inc (ZG, Financial), a prominent player in the interactive media industry, has recently seen a notable uptick in its stock performance. Over the past week, the company's shares have gained 4.66%, and over the last three months, the stock has surged by 12.72%. Currently, Zillow boasts a market capitalization of $11.38 billion. According to GuruFocus's valuation metrics, the stock is fairly valued at a price of $47.92 against a GF Value of $46.14. This valuation comes after a period where the stock was considered modestly undervalued three months ago.
Overview of Zillow Group Inc
Zillow Group Inc is at the forefront of internet-based real estate services, offering platforms for selling, buying, renting, and financing properties. The company collaborates with various real estate professionals to enhance the property transaction process through technology. Zillow's portfolio includes well-known brands such as Zillow, Trulia, and StreetEasy, among others. This diverse service offering positions Zillow as a comprehensive solution in the real estate market.
Assessing Zillow's Profitability
Zillow's financial health, as indicated by its Profitability Rank of 3/10, suggests challenges in maintaining profitability. The company's Operating Margin stands at -12.32%, which, although negative, fares better than 32.35% of its peers. In terms of return metrics, Zillow's Return on Equity (ROE) and Return on Assets (ROA) are -3.50% and -2.38% respectively, positioning it better than many competitors. The Return on Invested Capital (ROIC) is also less than ideal at -6.78%, yet it surpasses 38.33% of its industry counterparts.
Growth Prospects of Zillow
Zillow's Growth Rank is 5/10, indicating a moderate growth trajectory. The company has experienced a 3-Year Revenue Growth Rate per Share of -17.70%, which, despite being negative, is better than 13.12% of its peers. Looking ahead, Zillow's future revenue and EPS growth rates are estimated at 12.78% and 25.81% respectively, suggesting potential improvement and better performance relative to 59.14% and 63.87% of its industry peers.
Key Stakeholders in Zillow
Notable shareholders in Zillow include Philippe Laffont (Trades, Portfolio), holding 458,581 shares, and Baillie Gifford (Trades, Portfolio) with 90,705 shares. Although these figures represent small percentages of total shares, they reflect significant confidence from seasoned investors. Jim Simons, another prominent investor, holds a smaller position with 7,200 shares.
Competitive Landscape
Zillow operates in a competitive environment with key players like Twilio Inc (TWLO, Financial), Match Group Inc (MTCH, Financial), and Tencent Music Entertainment Group (TME, Financial), having market caps of $9.68 billion, $8.93 billion, and $22.6 billion respectively. This competitive analysis is crucial as it highlights the varying scales and scopes of companies within the interactive media space, influencing Zillow's strategic positioning and market share.
Conclusion
Zillow Group Inc presents a mixed financial canvas with moderate growth prospects and ongoing challenges in profitability. The company's recent stock performance and current valuation suggest a cautious optimism in the market. Investors considering Zillow should weigh its competitive position and financial metrics carefully, keeping an eye on both its growth potential and areas of financial improvement.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
