Fact based stock research
Zalando (XTRA:ZAL)

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How to read the free ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Zalando stock research in summary

zalando.de

ANALYSIS: With an Obermatt Combined Rank of 70 (better than 70% compared with investment alternatives), Zalando (Internet Retail, Germany) shares have above-average financial characteristics compared with similar stocks. Shares of Zalando are low in value (priced high) with a consolidated Value Rank of 8 (worse than 92% of alternatives). But they show above-average growth (Growth Rank of 96) and are safely financed (Safety Rank of 67, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 70, is a buy recommendation based on Zalando's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Zalando exhibits low value (Obermatt Value Rank of 8), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 96). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 67) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	8
Growth Rank	96
Safety Rank	67
Combined Rank	70

Country	Germany
Industry	Internet Retail
Index	CDAX, DAX 40, Diversity Europe, Renewables Users, SDG 12, SDG 13, SDG 4, SDG 8, MDAX
Size class	X-Large

This stock has achievements: Gold Winner CEO, Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Zalando

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	9	9	12	8
GROWTH
GROWTH	19	55	75	96
SAFETY
SAFETY	62	76	70	67
SENTIMENT
SENTIMENT	n/a	51	53	^new
360° VIEW
360° VIEW	n/a	41	66	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Zalando is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	9	9	12	8
GROWTH
GROWTH	19	55	75	96
SAFETY
SAFETY	62	76	70	67
COMBINED
COMBINED	24	40	56	70

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Zalando the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 8 (worse than 92% compared with alternatives), Zalando shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Zalando. Price-to-Sales is 33 which means that the stock price compared with what market professionals expect for future profits is higher than 67% of comparable companies, indicating a low value concerning Zalando's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 37, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Zalando. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 11 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 8, is a sell recommendation based on Zalando's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Zalando? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Zalando? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Zalando may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	43	30	44	33
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	28	8	6	11
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	12	32	44	37
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	9	9	12	8

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Zalando; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 96 (better than 96% compared with alternatives) for 2024, Zalando shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Zalando. Sales Growth has a value of 55, which means that, currently, professionals expect the company to grow more than 55% of its competitors. The same is valid for Profit Growth with a value of 91 and for Capital Growth with 89. In addition, Stock Returns had an above-average rank value of 96, which means they have been higher than 96% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 96, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Zalando exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	32	65	40	55
PROFIT GROWTH
PROFIT GROWTH	60	41	100	91
CAPITAL GROWTH
CAPITAL GROWTH	n/a	73	80	89
STOCK RETURNS
STOCK RETURNS	41	31	22	96
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	19	55	75	96

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Zalando.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 67 (better than 67% compared with alternatives), the company Zalando has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Zalando is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Zalando.Leverage is at 53, meaning the company has a below-average debt-to-equity ratio. It has less debt than 53% of its competitors.Refinancing is at a rank of 65, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 65% of its competitors. Liquidity is at 49, meaning that the company generates less profit to service its debt than 51% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 67 (better than 67% compared with alternatives), Zalando has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for Zalando more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	44	60	60	53
REFINANCING
REFINANCING	54	61	79	65
LIQUIDITY
LIQUIDITY	84	74	34	49
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	62	76	70	67

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Zalando and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	45	65	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	52	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	36	37	^new
MARKET PULSE
MARKET PULSE	n/a	62	54	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	51	53	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Zalando.
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