Zillow Group, Inc. (NASDAQ: ZG)

Sector: Communication Services Industry: Internet Content & Information CIK: 0001617640
Market Cap 11.24 Bn
P/B 2.30
P/E 488.78
P/S 4.35
ROIC (Qtr) -0.64
Div Yield % 0.00
Rev 1y % (Qtr) 18.05
Total Debt (Qtr) 457.00 Mn
Debt/Equity (Qtr) 0.09
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About

Zillow Group, Inc., commonly known as Zillow, operates as a leading online real estate marketplace in the United States. The company, which trades under the ticker symbol ZG, is headquartered in Seattle, Washington, and is renowned for its extensive range of services and products that facilitate residential real estate transactions, including buying, selling, renting, and financing. Zillow's primary business activities revolve around providing a comprehensive platform for real estate transactions. The company's offerings include Zillow, Trulia,...

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Investment thesis

Bull case

  • Strong operating cash flow of 368M provides robust 0.81x coverage of total debt 457M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 773M provide 2.04x coverage of short-term debt 378M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 2.58B provides 5.65x coverage of total debt 457M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 368M provides exceptional 20.44x coverage of interest expenses 18M, showing strong debt service capability.
  • Robust free cash flow of 235M exceeds capital expenditure of 133M by 1.77x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 368M barely covers its investment activities of (6M), with a coverage ratio of -61.33, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (6M) provide weak support for R&D spending of 607M, which is -0.01x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 368M shows concerning coverage of stock compensation expenses of 390M, with a 0.94 ratio indicating potential earnings quality issues.
  • Operating earnings of 43M show weak coverage of depreciation charges of 272M, with a 0.16 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 235M represents just -1.18x of debt issuance (200M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Product and Service Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Internet Content & Information
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GOOGL Alphabet Inc. 3,658.84 Bn 27.68 9.08 59.29 Bn
2 META Meta Platforms, Inc. 1,611.77 Bn 26.66 8.02 83.90 Bn
3 SPOT Spotify Technology S.A. 95.06 Bn 36.53 4.70 2.22 Bn
4 BIDU Baidu, Inc. 53.09 Bn 42.00 2.90 13.66 Bn
5 NBIS Nebius Group N.V. 27.43 Bn 269.75 51.78 4.89 Bn
6 RDDT Reddit, Inc. 25.97 Bn 49.02 11.79 0.02 Bn
7 TME Tencent Music Entertainment Group 23.51 Bn 15.03 5.28 0.54 Bn
8 BILI Bilibili Inc. 12.86 Bn 118.92 3.08 1.36 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.89 0.89
EV to Cash from Ops. EV/CFO 29.16 -2.77
EV to Debt EV to Debt 23.48 30.99
EV to EBIT EV/EBIT 249.53 2.55
EV to EBITDA EV/EBITDA 45.08 4.60
EV to Free Cash Flow [EV/FCF] EV/FCF 45.66 15.68
EV to Market Cap EV to Market Cap 0.95 1.23
EV to Revenue EV/Rev 4.15 63.03
Price to Book Value [P/B] P/B 2.30 1.29
Price to Earnings [P/E] P/E 488.78 17.11
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.34
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -8.66
Dividend per Basic Share Div per Share (Qtr) 0.00 0.31
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.48
Interest Coverage Int. cover (Qtr) 2.39 -209.50
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 6.99 -31.77
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -28.76 187.77
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.48
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 153.23 -1.13
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 349.06 -497.28
EBIT Growth (1y) % EBIT 1y % (Qtr) 160.56 20.22
EBT Growth (1y) % EBT 1y % (Qtr) 123.36 -38.13
EPS Growth (1y) % EPS 1y % (Qtr) 118.75 -32.36
FCF Growth (1y) % FCF 1y % (Qtr) -17.54 25.84
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 12.05 22.57
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.45 0.73
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 1.14 1.45
Current Ratio Curr Ratio (Qtr) 3.13 3.29
Debt to Equity Ratio Debt/Equity (Qtr) 0.09 -0.34
Interest Cover Ratio Int Coverage (Qtr) 2.39 -209.50
Times Interest Earned Times Interest Earned (Qtr) 2.39 -209.50
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 12.20 -4,353.96
EBIT Margin % EBIT Margin % (Qtr) 1.66 -4,865.94
EBT Margin % EBT Margin % (Qtr) 0.97 -5,084.75
Gross Margin % Gross Margin % (Qtr) 74.10 58.51
Net Profit Margin % Net Margin % (Qtr) 0.90 -5,086.49