We assign a fundamental rating of 5 out of 10 to ZD. ZD was compared to 70 industry peers in the Interactive Media & Services industry. ZD scores excellent on profitability, but there are some minor concerns on its financial health. ZD is cheap, but on the other hand it scores bad on growth. These ratings could make ZD a good candidate for value investing.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

ZD had positive earnings in the past year.
ZD had a positive operating cash flow in the past year.
ZD had positive earnings in each of the past 5 years.
ZD had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

The Return On Assets of ZD (3.19%) is better than 70.00% of its industry peers.
The Return On Equity of ZD (6.17%) is better than 72.86% of its industry peers.
ZD's Return On Invested Capital of 4.29% is fine compared to the rest of the industry. ZD outperforms 67.14% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ZD is significantly below the industry average of 13.70%.
The 3 year average ROIC (4.24%) for ZD is below the current ROIC(4.29%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	3.19%
ROE	6.17%
ROIC	4.29%

ROA(3y)1.57%

ROA(5y)4.39%

ROE(3y)3.01%

ROE(5y)9.34%

ROIC(3y)4.24%

ROIC(5y)3.97%

1.3 Margins

ZD's Profit Margin of 7.62% is fine compared to the rest of the industry. ZD outperforms 74.29% of its industry peers.
ZD's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 13.25%, ZD is in the better half of the industry, outperforming 77.14% of the companies in the same industry.
In the last couple of years the Operating Margin of ZD has grown nicely.
The Gross Margin of ZD (86.50%) is better than 87.14% of its industry peers.
ZD's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	13.25%
PM (TTM)	7.62%
GM	86.5%

OM growth 3Y-2.32%

OM growth 5Y11.07%

PM growth 3Y-49.55%

PM growth 5Y-26.37%

GM growth 3Y-0.39%

GM growth 5Y0.85%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ZD is destroying value.
Compared to 1 year ago, ZD has less shares outstanding
Compared to 5 years ago, ZD has less shares outstanding
Compared to 1 year ago, ZD has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 1.86 indicates that ZD is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of ZD (1.86) is better than 61.43% of its industry peers.
The Debt to FCF ratio of ZD is 3.32, which is a good value as it means it would take ZD, 3.32 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.32, ZD is in the better half of the industry, outperforming 68.57% of the companies in the same industry.
A Debt/Equity ratio of 0.48 indicates that ZD is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.48, ZD is not doing good in the industry: 64.29% of the companies in the same industry are doing better.

		Industry Rank	Sector Rank
Debt/Equity	0.48
Debt/FCF	3.32
Altman-Z	1.86

ROIC/WACC0.68

WACC6.28%

2.3 Liquidity

ZD has a Current Ratio of 1.61. This is a normal value and indicates that ZD is financially healthy and should not expect problems in meeting its short term obligations.
ZD's Current ratio of 1.61 is in line compared to the rest of the industry. ZD outperforms 41.43% of its industry peers.
A Quick Ratio of 1.61 indicates that ZD should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.61, ZD perfoms like the industry average, outperforming 41.43% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.61
Quick Ratio	1.61

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

ZD shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.67%.
Measured over the past years, ZD shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.19% on average per year.
ZD shows a small growth in Revenue. In the last year, the Revenue has grown by 5.70%.
ZD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.94% yearly.

EPS 1Y (TTM)4.67%

EPS 3Y-9.84%

EPS 5Y-1.19%

EPS Q2Q%7.32%

Revenue 1Y (TTM)5.7%

Revenue growth 3Y-0.35%

Revenue growth 5Y5.94%

Sales Q2Q%2.87%

3.2 Future

The Earnings Per Share is expected to grow by 6.07% on average over the next years.
Based on estimates for the next years, ZD will show a small growth in Revenue. The Revenue will grow by 3.22% on average per year.

EPS Next Y4.93%

EPS Next 2Y6.95%

EPS Next 3Y6.07%

EPS Next 5YN/A

Revenue Next Year3.37%

Revenue Next 2Y3.14%

Revenue Next 3Y3.22%

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 5.90, which indicates a rather cheap valuation of ZD.
91.43% of the companies in the same industry are more expensive than ZD, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.25. ZD is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 5.20, the valuation of ZD can be described as very cheap.
ZD's Price/Forward Earnings ratio is rather cheap when compared to the industry. ZD is cheaper than 95.71% of the companies in the same industry.
ZD's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.

		Industry Rank	Sector Rank
PE	5.9
Fwd PE	5.2

4.2 Price Multiples

ZD's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ZD is cheaper than 90.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ZD is valued cheaper than 92.86% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	6
EV/EBITDA	4.55

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ZD may justify a higher PE ratio.