Zalando (ZAL) AI Stock Analysis

• Market Cap: €7.84B
• Dividend Yield: N/A
• Average Volume (3M): 1.02M
• Price to Earnings (P/E): 29.0
• Beta (1Y): 1.47
• Revenue Growth: 6.14%
• EPS Growth: 140.08%
• Country: DE
• Employees: 15,463
• Sector: Consumer Cyclical
• Sector Strength: 62
• Industry: Specialty Retail
• EPS (TTM): 0.16
• Shares Outstanding: 264,137,400
• 10 Day Avg. Volume: 1,033,539
• 30 Day Avg. Volume: 1,023,230
• PEG Ratio: 0.17
• Price to Book (P/B): 2.29
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.93
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €38.96
• Price Target Upside: 29.18% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 65 Neutral
• Price Target: €33.00 ▲(9.42%Upside)

Zalando's overall score reflects strong financial performance supported by robust cash flow and profitability. However, technical indicators show bearish momentum, and valuation metrics suggest the stock may be overvalued. The lack of dividend yield further impacts attractiveness for some investors.

Positive Factors

Cash Flow

Free cash flow conversion is expected to remain impressive, resulting in a strong cash position even after a significant acquisition.

Market Share

Zalando SE is expected to gain market share due to an acceleration in online penetration rates in the fashion category.

Negative Factors

Growth Challenges

In a tricky consumer environment, it is believed that Zalando will find it difficult to accelerate growth significantly to meet its GMV guide.

Valuation Concerns

Zalando remains an expensive mature business with growth expectations that are too high.

Zalando Business Overview & Revenue Model

Company Description

Zalando SE operates an online platform for fashion and lifestyle products. It provides clothing, footwear, accessories, and beauty products with free delivery and returns. The company also sells its products through its Zalando Lounge; and brick-and-mortar outlet stores in Berlin, Frankfurt, Cologne, Leipzig, Hamburg, Hanover, Münster, Stuttgart, Mannheim, and Ulm. It serves customers in 23 countries, including Austria, Belgium, Croatia, Czechia, Denmark, Estonia, Finland, France, Germany, Ireland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Slovakia, Slovenia, Spain, Sweden, Switzerland, and the United Kingdom. The company was founded in 2008 and is headquartered in Berlin, Germany.

How the Company Makes Money

Zalando makes money primarily through the sale of fashion and lifestyle products on its online platforms. The company's revenue model is based on direct sales from its inventory as well as a platform business model where third-party sellers list and sell their products on Zalando's marketplace. In addition to product sales, Zalando generates revenue through advertising services, allowing brands to promote their products on its platforms. The company also benefits from strategic partnerships with fashion brands and logistics services that enhance its supply chain efficiency and customer reach. Zalando's focus on technological innovation, personalized shopping experiences, and a strong logistics network further contribute to its earnings by improving customer satisfaction and operational efficiency.

Zalando Financial Statement Overview

Summary

Zalando exhibits strong financial health with consistent revenue growth and stable profitability metrics. The cash flow is notably robust, demonstrating efficient operational management. However, the net profit margin has room for improvement, and increased leverage could present risks if profitability declines.

Income Statement

Zalando has shown consistent revenue growth with a notable increase from 2020 to 2025. The TTM Gross Profit Margin stands at 40.86% and the Net Profit Margin at 2.51%, reflecting strong profitability. The EBIT margin is 3.83%, and the EBITDA Margin is 7.67%, both indicating healthy operational efficiency. While margins are stable, the net profit margin shows room for improvement.

Balance Sheet

The debt-to-equity ratio is 0.64, indicating a manageable level of debt relative to equity. The return on equity (ROE) is 10.04%, showcasing effective use of shareholders' funds. The equity ratio is 33.17%, suggesting a balanced capital structure. However, the company's leverage has increased from previous years, which could pose a risk if profitability decreases.

Cash Flow

Zalando's cash flow is robust with a Free Cash Flow to Net Income Ratio of 1.69, indicating strong cash generation from operations. The Operating Cash Flow to Net Income Ratio is 2.27, further emphasizing efficient cash conversion. There is a positive Free Cash Flow Growth Rate, highlighting strong cash flow management and growth.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.75B	10.57B	10.14B	10.34B	10.35B	7.98B
	Gross Profit
4.39B	4.30B	3.68B	4.06B	4.33B	3.39B
	EBIT
411.60M	391.90M	228.80M	102.80M	415.60M	381.70M
	EBITDA
824.80M	811.30M	555.30M	395.30M	648.10M	596.20M
	Net Income Common Stockholders
269.90M	251.10M	83.00M	16.80M	234.50M	226.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.29B	2.69B	2.62B	2.04B	2.29B	2.69B
	Total Assets
6.90B	7.98B	8.11B	7.63B	6.90B	6.49B
	Total Debt
1.57B	1.73B	1.85B	1.72B	1.57B	1.77B
	Net Debt
-712.90M	-862.30M	-681.60M	-308.10M	-712.90M	-875.90M
	Total Liabilities
4.68B	5.32B	5.73B	5.43B	4.68B	4.34B
	Stockholders Equity
2.22B	2.67B	2.37B	2.20B	2.22B	2.15B
Cash Flow		Free Cash Flow
454.90M	447.30M	686.30M	108.30M	283.30M	277.30M
	Operating Cash Flow
613.10M	654.10M	949.50M	459.90M	616.20M	527.40M
	Investing Cash Flow
-639.50M	-269.80M	-320.70M	-476.20M	-335.90M	-217.80M
	Financing Cash Flow
-315.70M	-325.60M	-123.60M	-245.90M	-639.80M	1.35B

Zalando Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 30.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:ZAL, the sentiment is Negative. The current price of 30.16 is below the 20-day moving average (MA) of 31.07, below the 50-day MA of 31.93, and below the 200-day MA of 30.98, indicating a bearish trend. The MACD of -0.40 indicates Positive momentum. The RSI at 42.24 is Neutral, neither overbought nor oversold. The STOCH value of 6.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:ZAL.

Zalando Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TNIE	66 Neutral	€794.07M	54.43	3.90%	―	33.13%	―
ZAL	65 Neutral	€7.84B	29.04	10.57%	―	6.14%	140.08%
Sector *	62 Neutral	$6.88B	11.32	2.90%	3.87%	2.70%	-24.57%
MRX	47 Neutral	€53.95M	―	-74.67%	―	-3.03%	-76.50%
YOU		€1.15B	―	-47.97%	―	―	―
KTA	49 Neutral	€139.06M	8.26	-44.46%	21.64%	-30.93%	-215.26%
ATOGF		$6.29B	107.82	8.72%	―	―	―