Overall ZI gets a fundamental rating of 4 out of 10. We evaluated ZI against 70 industry peers in the Interactive Media & Services industry. There are concerns on the financial health of ZI while its profitability can be described as average. ZI has a correct valuation and a medium growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year ZI was profitable.
ZI had a positive operating cash flow in the past year.
Of the past 5 years ZI 4 years were profitable.
In the past 5 years ZI always reported a positive cash flow from operatings.

1.2 Ratios

ZI's Return On Assets of 0.45% is in line compared to the rest of the industry. ZI outperforms 59.15% of its industry peers.
Looking at the Return On Equity, with a value of 1.72%, ZI is in the better half of the industry, outperforming 63.38% of the companies in the same industry.
With a Return On Invested Capital value of 1.01%, ZI perfoms like the industry average, outperforming 56.34% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ZI is significantly below the industry average of 13.53%.

		Industry Rank	Sector Rank
ROA	0.45%
ROE	1.72%
ROIC	1.01%

ROA(3y)0.97%

ROA(5y)0.79%

ROE(3y)3.19%

ROE(5y)2.49%

ROIC(3y)2.12%

ROIC(5y)1.92%

1.3 Margins

With a Profit Margin value of 2.40%, ZI perfoms like the industry average, outperforming 59.15% of the companies in the same industry.
In the last couple of years the Profit Margin of ZI has declined.
Looking at the Operating Margin, with a value of 8.04%, ZI is in the better half of the industry, outperforming 71.83% of the companies in the same industry.
In the last couple of years the Operating Margin of ZI has remained more or less at the same level.
ZI has a better Gross Margin (84.37%) than 78.87% of its industry peers.
In the last couple of years the Gross Margin of ZI has grown nicely.

		Industry Rank	Sector Rank
OM	8.04%
PM (TTM)	2.4%
GM	84.37%

OM growth 3Y-7.24%

OM growth 5Y-1.45%

PM growth 3Y-46.48%

PM growth 5YN/A

GM growth 3Y1.23%

GM growth 5Y2.11%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

ZI has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for ZI has been reduced compared to 1 year ago.
Compared to 5 years ago, ZI has less shares outstanding
ZI has a worse debt/assets ratio than last year.

2.2 Solvency

Based on the Altman-Z score of 0.71, we must say that ZI is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.71, ZI is doing worse than 60.56% of the companies in the same industry.
ZI has a debt to FCF ratio of 4.03. This is a neutral value as ZI would need 4.03 years to pay back of all of its debts.
The Debt to FCF ratio of ZI (4.03) is comparable to the rest of the industry.
ZI has a Debt/Equity ratio of 0.72. This is a neutral value indicating ZI is somewhat dependend on debt financing.
ZI has a Debt to Equity ratio of 0.72. This is in the lower half of the industry: ZI underperforms 73.24% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.72
Debt/FCF	4.03
Altman-Z	0.71

ROIC/WACC0.13

WACC8.07%

2.3 Liquidity

A Current Ratio of 0.69 indicates that ZI may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.69, ZI is doing worse than 87.32% of the companies in the same industry.
ZI has a Quick Ratio of 0.69. This is a bad value and indicates that ZI is not financially healthy enough and could expect problems in meeting its short term obligations.
ZI has a worse Quick ratio (0.69) than 85.92% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	0.69
Quick Ratio	0.69

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

ZI shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -9.62%.
Measured over the past years, ZI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.70% on average per year.
ZI shows a decrease in Revenue. In the last year, the revenue decreased by -2.03%.
The Revenue has been growing by 32.86% on average over the past years. This is a very strong growth!

EPS 1Y (TTM)-9.62%

EPS 3Y18.7%

EPS 5YN/A

EPS Q2Q%-11.54%

Revenue 1Y (TTM)-2.03%

Revenue growth 3Y17.57%

Revenue growth 5Y32.86%

Sales Q2Q%-1.42%

3.2 Future

Based on estimates for the next years, ZI will show a small growth in Earnings Per Share. The EPS will grow by 6.33% on average per year.
The Revenue is expected to grow by 4.58% on average over the next years.

EPS Next Y3.23%

EPS Next 2Y3.81%

EPS Next 3Y-0.24%

EPS Next 5Y6.33%

Revenue Next Year-0.24%

Revenue Next 2Y1.2%

Revenue Next 3Y2.06%

Revenue Next 5Y4.58%

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 decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 10.97, which indicates a very decent valuation of ZI.
Compared to the rest of the industry, the Price/Earnings ratio of ZI indicates a somewhat cheap valuation: ZI is cheaper than 78.87% of the companies listed in the same industry.
ZI's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.30.
ZI is valuated reasonably with a Price/Forward Earnings ratio of 9.86.
Based on the Price/Forward Earnings ratio, ZI is valued a bit cheaper than the industry average as 77.46% of the companies are valued more expensively.
ZI is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	10.97
Fwd PE	9.86

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ZI is on the same level as its industry peers.
ZI's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ZI is cheaper than 73.24% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	11.46
EV/EBITDA	24.97

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ZI does not grow enough to justify the current Price/Earnings ratio.