Ermenegildo Zegna (ZGN)
NYSE:ZGN
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Ermenegildo Zegna
(NYSE:ZGN)
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Rating:62Neutral
Price Target:
$11.00
▼(-4.43% Downside)
Action:ReiteratedDate:04/01/26
The score is driven primarily by solid financial quality—especially strong cash flow and improving balance sheet leverage—tempered by weakening revenue/margin trends. The earnings call supports a constructive longer-term story (DTC mix, gross margin, net cash) but near-term guidance is cautious with FX, SG&A, and wholesale headwinds. Technical signals are mixed and valuation is reasonable-to-full with only a modest dividend.
Positive Factors
Strong cash generation and net cash position
Material, recurring free cash flow and a pivot to net cash provide durable financial flexibility. Sustained FCF growth funds capex, marketing and dividends, supports deleveraging, and cushions the business against cyclical demand shocks while enabling strategic investments over the medium term.
Negative Factors
Recent revenue weakness
A negative revenue trajectory limits operating leverage and can erode profitability over time if sustained. Persistent top‑line softness reduces the ability to absorb fixed SG&A, slows brand reinvestment returns, and complicates multi‑year margin recovery plans.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation and net cash position
Material, recurring free cash flow and a pivot to net cash provide durable financial flexibility. Sustained FCF growth funds capex, marketing and dividends, supports deleveraging, and cushions the business against cyclical demand shocks while enabling strategic investments over the medium term.
Read all positive factors
Ermenegildo Zegna (ZGN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.87B
Dividend Yield1.33%
Average Volume (3M)571.50K
Price to Earnings (P/E)23.9
Beta (1Y)1.26
Revenue Growth-1.88%
EPS Growth-5.94%
CountryUS
Employees7,185
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Manufacturers
Share Statistics
EPS (TTM)0.28
Shares Outstanding268,312,040
10 Day Avg. Volume642,963
30 Day Avg. Volume571,498
Financial Highlights & Ratios
PEG Ratio1.24
Price to Book (P/B)2.20
Price to Sales (P/S)1.23
P/FCF Ratio9.35
Enterprise Value/Market Cap0.70
Enterprise Value/Revenue1.78
Enterprise Value/Gross Profit2.88
Enterprise Value/Ebitda10.40
Forecast
1Y Price Target
$12.01Price Target Upside4.34% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)0.4
Revenue Forecast (FY)$1.99B
Ermenegildo Zegna Business Overview & Revenue Model
Company Description
Ermenegildo Zegna N.V., together with its subsidiaries, designs, manufactures, markets, and distributes luxury menswear, footwear, leather goods, and other accessories under the Zegna and the Thom Browne brands. It provides luxury leisurewear for ...
How the Company Makes Money
The company primarily makes money by selling luxury goods across its brands through two main routes: (1) Direct-to-consumer (DTC) sales and (2) wholesale distribution. DTC revenue is generated via the group’s own retail stores and e-commerce, capt...
Ermenegildo Zegna Earnings Call Summary
Earnings Call Date:Mar 20, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 21, 2026
Earnings Call Sentiment Positive
The call presented a generally positive financial and operational picture: improved gross margin (+90 bps), higher DTC mix (82% vs 78%), stronger reported profit (+20% to EUR 109.5m), materially improved cash generation (free cash flow EUR 82m) and a net cash surplus (EUR 52m). These positives are balanced against meaningful near-term challenges: SG&A deleverage, continued wholesale streamlining (notably at Thom Browne), a Tom Ford H1 loss (improved in H2), FX headwinds (~2ppt on revenues) and uncertainty from the Middle East conflict. Management reiterated a cautious 2026 posture (profitability broadly sideline) while outlining multi-year plans to restore double-digit margins at the growth brands and to invest for long-term value.Positive Updates
Stable Full-Year Revenue with Organic Growth
Full-year revenues of EUR 1.917 billion: reported decline of -1.5% YoY but organic growth of +1.1% YoY, indicating underlying positive momentum when currency and timing effects are excluded.
Negative Updates
Reported Revenue Decline and FX Headwinds
Reported revenues declined -1.5% YoY; management cites FX as a headwind (around ~2 percentage points impact expected on 2026 revenues vs 2025), creating uncertainty for topline and margin progression in near term.
Read all updates
Q4-2025 Updates
Positive
Negative
Stable Full-Year Revenue with Organic Growth
Full-year revenues of EUR 1.917 billion: reported decline of -1.5% YoY but organic growth of +1.1% YoY, indicating underlying positive momentum when currency and timing effects are excluded.
Read all positive updates
Company Guidance
The management confirmed FY25 metrics and gave directional 2026 guidance: FY25 revenues were EUR 1.917bn (‑1.5% reported, +1.1% organic) with a 67.5% gross margin and adjusted EBIT of EUR 163m (EUR 173m excl. a EUR 10m Saks provision), group profit of EUR 109.5m (+20%), net cash surplus of EUR 52m and DTC at 82% of branded revenues; SG&A was EUR 1.034bn (53.9% of revenues), marketing EUR 121m (6.3% of revenues, with a mid‑term target ~6%), CapEx EUR 103m (5.4% of revenues, expected ~7% in 2026 for the Parma shoe factory), trade working capital EUR 408m (21.3% of revenues) and free cash flow EUR 82m (plus EUR 107m from sale of treasury shares to Temasek); they proposed a EUR 0.12/share dividend (~EUR 32m). For 2026 management expects revenues around EUR 2bn, a “sideline” (roughly flat) group EBIT margin versus 2025 excluding one‑offs, about a 2‑point FX headwind to revenues, continued DTC momentum, wholesale reductions (Zegna mid‑teens decline, Tom Ford negative single‑digit, Thom Browne double‑digit but improving), Tom Ford and Thom Browne moving back toward double‑digit EBIT in the medium term, and marketing investment remaining at about 6% of revenues.Ermenegildo Zegna Financial Statement Overview
Summary
Income Statement
64
Positive
Balance Sheet
58
Neutral
Cash Flow
71
Positive
| Breakdown | Dec 2025 | Dec 2024 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.84B | 1.95B | 1.90B | 1.49B | 1.29B |
| Gross Profit | 1.02B | 1.30B | 1.22B | 928.01M | 925.13M |
| EBITDA | 391.75M | 406.23M | 392.95M | 335.50M | 71.14M |
| Net Income | 94.69M | 77.08M | 121.53M | 51.48M | -136.00M |
Balance Sheet | |||||
| Total Assets | 2.83B | 2.83B | 2.77B | 2.43B | 2.46B |
| Cash, Cash Equivalents and Short-Term Investments | 295.68M | 296.13M | 387.03M | 580.29M | 800.17M |
| Total Debt | 977.36M | 1.04B | 996.35M | 914.56M | 1.07B |
| Total Liabilities | 1.73B | 1.85B | 1.87B | 1.69B | 1.81B |
| Stockholders Equity | 1.03B | 916.12M | 840.29M | 678.95M | 601.21M |
Cash Flow | |||||
| Free Cash Flow | 242.19M | 153.60M | 197.50M | 73.10M | 186.83M |
| Operating Cash Flow | 322.32M | 279.13M | 275.38M | 146.40M | 281.15M |
| Investing Cash Flow | -105.58M | -126.01M | 21.79M | -57.34M | -82.00M |
| Financing Cash Flow | -206.57M | -234.53M | -250.49M | -297.00M | -64.11M |
Ermenegildo Zegna Technical Analysis
Positive
11.51
Price Trends
10.48
Positive
10.39
Positive
9.75
Positive
Market Momentum
0.21
Negative
63.02
Neutral
93.72
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZGN, the sentiment is Positive. The current price of 11.51 is above the 20-day moving average (MA) of 10.24, above the 50-day MA of 10.48, and above the 200-day MA of 9.75, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 63.02 is Neutral, neither overbought nor oversold. The STOCH value of 93.72 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ZGN.
Ermenegildo Zegna Risk Analysis
Ermenegildo Zegna disclosed 45 risk factors in its most recent earnings report. Ermenegildo Zegna reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Summary of Risk Factors Q4, 2023
Ermenegildo Zegna Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $8.75B | 11.94 | 28.33% | 2.58% | -1.23% | 109.67% | |
69 Neutral | $23.00B | 15.13 | 34.74% | 0.93% | 12.32% | 29.40% | |
63 Neutral | $3.00B | 17.00 | 10.53% | 2.18% | 2.76% | -7.83% | |
62 Neutral | $4.87B | 23.92 | 10.25% | 1.33% | -1.88% | -5.94% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $4.16B | 117.41 | 0.53% | 0.22% | 0.52% | -45.80% | |
53 Neutral | $7.13B | 6.01 | 14.79% | 1.95% | -3.12% | ― |
* Consumer Cyclical Sector Average
ZGN
Ermenegildo Zegna
11.51
4.77
70.77%
COLM
Columbia Sportswear
57.26
-8.86
-13.40%
PVH
PVH
90.74
20.58
29.34%
RL
Ralph Lauren
379.87
180.45
90.49%
VFC
VF
18.23
7.22
65.53%
LEVI
Levi Strauss & Co
22.75
8.21
56.44%
Ermenegildo Zegna Corporate Events
Ermenegildo Zegna Lifts 2025 Profit 20% and Swings to Cash Surplus Despite Slight Revenue Dip
Mar 20, 2026
On March 20, 2026, Ermenegildo Zegna reported its full-year 2025 results, showing a 20% year-on-year rise in profit to €109.5 million despite a 1.5% decline in reported revenues to €1,916.9 million. The group improved its gross margin ...
Ermenegildo Zegna Files 2025 Form 20-F With U.S. Regulators
Mar 20, 2026
Ermenegildo Zegna N.V., the Milan-based parent of the Ermenegildo Zegna Group, operates as a global luxury leader in high-end menswear and fashion. Its portfolio spans ZEGNA’s classic luxury, Thom Browne’s modern tailoring and TOM FORD...
Ermenegildo Zegna Sets March 20 Date to Unveil 2025 Results
Mar 6, 2026
Ermenegildo Zegna N.V., the NYSE-listed parent of the Ermenegildo Zegna Group, said on March 6, 2026, that it will publish its full-year 2025 financial results on March 20, 2026. The company will host a conference call and live webcast shortly aft...
Ermenegildo Zegna Posts Slight 2025 Revenue Dip as DTC Strategy and Leadership Transition Take Hold
Feb 2, 2026
On February 2, 2026, Ermenegildo Zegna Group reported preliminary, unaudited revenues of €1.9169 billion for fiscal year 2025, down 1.5% year-on-year but up 1.1% on an organic basis, reflecting a deliberate shift toward its direct-to-consume...
Ermenegildo Zegna to Release FY 2025 Preliminary Revenues on February 2, 2026
Jan 20, 2026
On January 20, 2026, Ermenegildo Zegna Group announced it will publish preliminary revenue figures for full-year 2025 on February 2, 2026, followed by a conference call and live webcast for investors and analysts. The release of these preliminary ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.