ERMENEGILDO ZEGNA NV (ZGN) Stock Fundamental Analysis
NYSE:ZGN - NL0015000PB5 - Common Stock
8.25 USD
+0.32 (+4.04%)
8.25 USD
0 (0%)
Taking everything into account, ZGN scores 4 out of 10 in our fundamental rating. ZGN was compared to 50 industry peers in the Textiles, Apparel & Luxury Goods industry. ZGN has a medium profitability rating, but doesn't score so well on its financial health evaluation. ZGN is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
ZGN had positive earnings in the past year.
In the past year ZGN had a positive cash flow from operations.
In multiple years ZGN reported negative net income over the last 5 years.
In the past 5 years ZGN always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.72%, ZGN perfoms like the industry average, outperforming 52.00% of the companies in the same industry.
With a Return On Equity value of 8.41%, ZGN perfoms like the industry average, outperforming 54.00% of the companies in the same industry.
ZGN has a Return On Invested Capital (6.96%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for ZGN is below the industry average of 11.02%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.72% | ||
| ROE | 8.41% | ||
| ROIC | 6.96% |
ROA(3y)3.08%
ROA(5y)0.32%
ROE(3y)10.15%
ROE(5y)-0.11%
ROIC(3y)7.69%
ROIC(5y)N/A
1.3 Margins
ZGN has a Profit Margin (3.96%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of ZGN has grown nicely.
ZGN has a better Operating Margin (9.45%) than 72.00% of its industry peers.
ZGN's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 66.60%, ZGN belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
In the last couple of years the Gross Margin of ZGN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.45% | ||
| PM (TTM) | 3.96% | ||
| GM | 66.6% |
OM growth 3YN/A
OM growth 5Y2.91%
PM growth 3YN/A
PM growth 5Y19.25%
GM growth 3Y-2.37%
GM growth 5Y-1.14%
2. Health
2.1 Basic Checks
ZGN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, ZGN has more shares outstanding
Compared to 5 years ago, ZGN has more shares outstanding
The debt/assets ratio for ZGN is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.60, we must say that ZGN is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.60, ZGN is doing worse than 78.00% of the companies in the same industry.
ZGN has a debt to FCF ratio of 6.74. This is a slightly negative value and a sign of low solvency as ZGN would need 6.74 years to pay back of all of its debts.
ZGN's Debt to FCF ratio of 6.74 is in line compared to the rest of the industry. ZGN outperforms 48.00% of its industry peers.
A Debt/Equity ratio of 0.78 indicates that ZGN is somewhat dependend on debt financing.
ZGN has a Debt to Equity ratio of 0.78. This is in the lower half of the industry: ZGN underperforms 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 6.74 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.9
WACC7.74%
2.3 Liquidity
ZGN has a Current Ratio of 1.41. This is a normal value and indicates that ZGN is financially healthy and should not expect problems in meeting its short term obligations.
ZGN's Current ratio of 1.41 is on the low side compared to the rest of the industry. ZGN is outperformed by 76.00% of its industry peers.
ZGN has a Quick Ratio of 1.41. This is a bad value and indicates that ZGN is not financially healthy enough and could expect problems in meeting its short term obligations.
ZGN's Quick ratio of 0.80 is on the low side compared to the rest of the industry. ZGN is outperformed by 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.41 | ||
| Quick Ratio | 0.8 |
3. Growth
3.1 Past
ZGN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -36.78%.
Measured over the past years, ZGN shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.50% on average per year.
The Revenue has been growing slightly by 2.21% in the past year.
ZGN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.06% yearly.
EPS 1Y (TTM)-36.78%
EPS 3YN/A
EPS 5Y27.5%
EPS Q2Q%-30.34%
Revenue 1Y (TTM)2.21%
Revenue growth 3Y14.63%
Revenue growth 5Y8.06%
Sales Q2Q%72.97%
3.2 Future
The Earnings Per Share is expected to grow by 13.62% on average over the next years. This is quite good.
The Revenue is expected to grow by 4.46% on average over the next years.
EPS Next Y1.17%
EPS Next 2Y9.66%
EPS Next 3Y13.62%
EPS Next 5YN/A
Revenue Next Year-0.92%
Revenue Next 2Y2.05%
Revenue Next 3Y3.44%
Revenue Next 5Y4.46%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.57, the valuation of ZGN can be described as rather expensive.
ZGN's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of ZGN to the average of the S&P500 Index (27.24), we can say ZGN is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 20.15, the valuation of ZGN can be described as rather expensive.
ZGN's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 35.82. ZGN is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 20.15 |
4.2 Price Multiples
ZGN's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ZGN is cheaper than 86.00% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ZGN indicates a rather cheap valuation: ZGN is cheaper than 82.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.73 | ||
| EV/EBITDA | 5.7 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ZGN does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as ZGN's earnings are expected to grow with 13.62% in the coming years.
PEG (NY)20.09
PEG (5Y)0.86
EPS Next 2Y9.66%
EPS Next 3Y13.62%
5. Dividend
5.1 Amount
ZGN has a Yearly Dividend Yield of 1.42%.
Compared to an average industry Dividend Yield of 3.63, ZGN pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.36, ZGN is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.42% |
5.2 History
ZGN has paid a dividend for less than 5 years, so there is no long track record yet.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
ZGN pays out 39.30% of its income as dividend. This is a sustainable payout ratio.
DP39.3%
EPS Next 2Y9.66%
EPS Next 3Y13.62%
8.25
+0.32 (+4.04%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners15.56%
Inst Owner ChangeN/A
Ins Owners3.35%
Ins Owner ChangeN/A
Market Cap2.10B
Analysts76
Price Target9.56 (15.88%)
Short Float %6.5%
Short Ratio3.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.42% |
Yearly Dividend0.14
Dividend Growth(5Y)N/A
DP39.3%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-12.1%
Min Revenue beat(2)-23.21%
Max Revenue beat(2)-0.99%
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)5.59%
PT rev (3m)5.59%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)-3.24%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.36%
Revenue NY rev (3m)-1.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 20.15 | ||
| P/S | 0.93 | ||
| P/FCF | 11.73 | ||
| P/OCF | 6.45 | ||
| P/B | 1.97 | ||
| P/tB | 5.97 | ||
| EV/EBITDA | 5.7 |
EPS(TTM)0.35
EY4.24%
EPS(NY)0.41
Fwd EY4.96%
FCF(TTM)0.7
FCFY8.53%
OCF(TTM)1.28
OCFY15.5%
SpS8.92
BVpS4.2
TBVpS1.38
PEG (NY)20.09
PEG (5Y)0.86
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.72% | ||
| ROE | 8.41% | ||
| ROCE | 9.29% | ||
| ROIC | 6.96% | ||
| ROICexc | 8.18% | ||
| ROICexgc | 12.88% | ||
| OM | 9.45% | ||
| PM (TTM) | 3.96% | ||
| GM | 66.6% | ||
| FCFM | 7.89% |
ROA(3y)3.08%
ROA(5y)0.32%
ROE(3y)10.15%
ROE(5y)-0.11%
ROIC(3y)7.69%
ROIC(5y)N/A
ROICexc(3y)10.34%
ROICexc(5y)N/A
ROICexgc(3y)17.93%
ROICexgc(5y)N/A
ROCE(3y)10.27%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y8.96%
ROICexc growth 3YN/A
ROICexc growth 5Y6.96%
OM growth 3YN/A
OM growth 5Y2.91%
PM growth 3YN/A
PM growth 5Y19.25%
GM growth 3Y-2.37%
GM growth 5Y-1.14%
F-Score5
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 6.74 | ||
| Debt/EBITDA | 1.7 | ||
| Cap/Depr | 53.2% | ||
| Cap/Sales | 6.45% | ||
| Interest Coverage | 4.82 | ||
| Cash Conversion | 66.46% | ||
| Profit Quality | 199.27% | ||
| Current Ratio | 1.41 | ||
| Quick Ratio | 0.8 | ||
| Altman-Z | 1.6 |
F-Score5
WACC7.74%
ROIC/WACC0.9
Cap/Depr(3y)45.13%
Cap/Depr(5y)42.84%
Cap/Sales(3y)5.15%
Cap/Sales(5y)5.32%
Profit Quality(3y)167.91%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-36.78%
EPS 3YN/A
EPS 5Y27.5%
EPS Q2Q%-30.34%
EPS Next Y1.17%
EPS Next 2Y9.66%
EPS Next 3Y13.62%
EPS Next 5YN/A
Revenue 1Y (TTM)2.21%
Revenue growth 3Y14.63%
Revenue growth 5Y8.06%
Sales Q2Q%72.97%
Revenue Next Year-0.92%
Revenue Next 2Y2.05%
Revenue Next 3Y3.44%
Revenue Next 5Y4.46%
EBIT growth 1Y-11.59%
EBIT growth 3YN/A
EBIT growth 5Y11.21%
EBIT Next Year139.15%
EBIT Next 3Y42.46%
EBIT Next 5YN/A
FCF growth 1Y-22.23%
FCF growth 3Y-6.33%
FCF growth 5Y6.03%
OCF growth 1Y1.36%
OCF growth 3Y-0.25%
OCF growth 5Y9.9%