Zillow Rated High on Value Investor Model Despite Some Failures

Zillow Group Inc receives a rating of 57% on the Value Investor model based on Benjamin Graham's strategy. Despite positive indicators, failures in long-term EPS growth and valuation ratios could affect stock performance.

Date: 17-02-2025

AI Rating: 5

Zillow Group Inc Analysis
Zillow Group Inc has received a rating of 57% according to the Value Investor model founded on Benjamin Graham's investment strategy. This score indicates that, while the company performs reasonably well based on its fundamentals, it does not attract strong interest, which usually signifies a score above 80%.

Key Areas of Concern: The analysis highlights several PASS categories including sector, sales, current ratio, and long-term debt relative to net current assets. However, the stock shows weaknesses in critical areas such as Long-term EPS Growth, P/E Ratio, and Price/Book Ratio, each of which received a FAIL assessment. The long-term EPS growth factor in particular suggests that Zillow has not achieved projected earnings growth over an extended timeframe, which could raise concerns for investors focused on profitability. Additionally, a failing P/E ratio indicates that investors may view the stock as overvalued based on its earnings relative to the market.

These challenges could have a direct impact on Zillow's stock price moving forward. Investors typically prefer stocks that exhibit strong growth potential and favorable valuations, and failing these categories may limit Zillow's appeal, particularly in a competitive market.

Overall, while the fundamentals show some resilience, the failures in long-term earnings growth and valuation ratios present areas of concern that could influence investor sentiment and stock performance negatively.

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