Critical Survey: Alphabet (NASDAQ:GOOG) versus Zillow Group (NASDAQ:Z)

Alphabet (NASDAQ:GOOG) and Zillow Group (NASDAQ:Z) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.

Earnings and Valuation

This table compares Alphabet and Zillow Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alphabet	$402.84 billion	10.86	$132.17 billion	$13.11	27.55
Zillow Group	$2.58 billion	3.08	$23.00 million	$0.25	139.16

Alphabet has higher revenue and earnings than Zillow Group. Alphabet is trading at a lower price-to-earnings ratio than Zillow Group, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Alphabet has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, Zillow Group has a beta of 1.97, meaning that its share price is 97% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Alphabet and Zillow Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alphabet	0	4	29	5	3.03
Zillow Group	1	7	4	2	2.50

Alphabet currently has a consensus target price of $376.00, indicating a potential upside of 4.11%. Zillow Group has a consensus target price of $77.00, indicating a potential upside of 121.33%. Given Zillow Group’s higher possible upside, analysts clearly believe Zillow Group is more favorable than Alphabet.

Institutional & Insider Ownership

27.3% of Alphabet shares are held by institutional investors. Comparatively, 71.0% of Zillow Group shares are held by institutional investors. 13.0% of Alphabet shares are held by company insiders. Comparatively, 23.8% of Zillow Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Alphabet and Zillow Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alphabet	37.92%	38.99%	27.41%
Zillow Group	2.27%	1.41%	1.22%

Summary

Alphabet beats Zillow Group on 10 of the 15 factors compared between the two stocks.

About Alphabet

Alphabet Inc. offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. It is also involved in the sale of apps and in-app purchases and digital content in the Google Play and YouTube; and devices, as well as in the provision of YouTube consumer subscription services. The Google Cloud segment offers infrastructure, cybersecurity, databases, analytics, AI, and other services; Google Workspace that include cloud-based communication and collaboration tools for enterprises, such as Gmail, Docs, Drive, Calendar, and Meet; and other services for enterprise customers. The Other Bets segment sells healthcare-related and internet services. The company was incorporated in 1998 and is headquartered in Mountain View, California.

About Zillow Group

Zillow Group, Inc. operates real estate brands in mobile applications and Websites in the United States. The company offers premier agent and rentals marketplaces, new construction marketplaces, advertising, display advertising, and business technology solutions, as well as dotloop and floor plans. It also provides mortgage originations and the sale of mortgages, and advertising to mortgage lenders and other mortgage professionals; and title and escrow services. In addition, the company's brand portfolio includes Zillow Premier Agent, Zillow Home Loans, Zillow Rentals, Trulia, StreetEasy, HotPads, and Out East; and a suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce, and Follow Up Boss. Zillow Group, Inc. was incorporated in 2004 and is headquartered in Seattle, Washington.