Reviewing Zhihu (ZH) and Its Peers

Zhihu (NYSE:ZH) is one of 192 public companies in the “Interactive Media & Services” industry, but how does it compare to its peers? We will compare Zhihu to related businesses based on the strength of its analyst recommendations, profitability, earnings, risk, dividends, valuation and institutional ownership.

Volatility and Risk

Zhihu has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500. Comparatively, Zhihu’s peers have a beta of 1.82, meaning that their average share price is 82% more volatile than the S&P 500.

Profitability

This table compares Zhihu and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zhihu	-11.33%	-7.71%	-5.75%
Zhihu Competitors	-349.32%	-16.54%	4.26%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Zhihu and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zhihu	1	0	0	0	1.00
Zhihu Competitors	1435	5971	11500	441	2.57

As a group, “Interactive Media & Services” companies have a potential upside of 39.64%. Given Zhihu’s peers stronger consensus rating and higher probable upside, analysts clearly believe Zhihu has less favorable growth aspects than its peers.

Earnings and Valuation

This table compares Zhihu and its peers revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Zhihu	$393.10 million	-$27.58 million	-5.72
Zhihu Competitors	$12.05 billion	$3.48 billion	21.98

Zhihu’s peers have higher revenue and earnings than Zhihu. Zhihu is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Institutional & Insider Ownership

28.9% of Zhihu shares are owned by institutional investors. Comparatively, 41.2% of shares of all “Interactive Media & Services” companies are owned by institutional investors. 13.6% of Zhihu shares are owned by insiders. Comparatively, 24.0% of shares of all “Interactive Media & Services” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Zhihu peers beat Zhihu on 11 of the 13 factors compared.

Zhihu Company Profile

Zhihu Inc. operates an online content community in the People’s Republic of China. Its community allows people to seek inspiration, find solutions, make decisions, and have fun. The company offers technology, business support, and consulting services; information transmission, software, and information technology services. It also offers information and marketing services; vocational training; and internet services, as well as holds audio-visual permit. Zhihu Inc. was founded in 2010 and is headquartered in Beijing, the People’s Republic of China.