Analyzing Weibo (NASDAQ:WB) and Zillow Group (NASDAQ:Z)

Zillow Group (NASDAQ:Z) and Weibo (NASDAQ:WB) are both communication services companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.

Earnings and Valuation

This table compares Zillow Group and Weibo”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zillow Group	$2.81 billion	2.33	$23.00 million	$0.22	132.59
Weibo	$1.76 billion	0.90	$449.02 million	$1.21	5.32

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

Volatility and Risk

Zillow Group has a beta of 2.04, indicating that its share price is 104% more volatile than the S&P 500. Comparatively, Weibo has a beta of 0.17, indicating that its share price is 83% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Zillow Group and Weibo, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zillow Group	1	7	5	1	2.43
Weibo	3	2	1	0	1.67

Zillow Group currently has a consensus target price of $61.29, suggesting a potential upside of 110.10%. Weibo has a consensus target price of $8.80, suggesting a potential upside of 36.65%. Given Zillow Group’s stronger consensus rating and higher possible upside, equities analysts clearly believe Zillow Group is more favorable than Weibo.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Zillow Group	1.96%	2.32%	1.97%
Weibo	17.78%	8.87%	4.96%

Institutional & Insider Ownership

71.0% of Zillow Group shares are owned by institutional investors. Comparatively, 68.8% of Weibo shares are owned by institutional investors. 25.0% of Zillow Group shares are owned by company insiders. Comparatively, 41.3% of Weibo shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Zillow Group beats Weibo on 9 of the 15 factors compared between the two stocks.

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.

About Weibo

Weibo Corporation, through its subsidiaries, operates as a social media platform for people to create, discover, and distribute content in the People’s Republic of China. It operates in two segments, Advertising and Marketing Services; and Value-Added Services. The company offers discovery products to help users discover content on its platform; self-expression products that enable its users to express themselves on its platform; and social products to promote social interaction between users on its platform. It also provides advertising and marketing solutions, such as social display advertisements; and promoted marketing offerings, such as Fans Headline and Weibo Express promoted feeds, as well as promoted trends and search products that appear alongside user’s trends discovery and search behaviors. In addition, the company offers products, such as trends, search, video/live streaming, and editing tools; content customization, copyright contents pooling, and user interaction development; and search list recommendation, trends list recommendation, and Weibo app opening advertisements. Further, it provides back-end management, traffic support, and product services for better displaying and promotion of its account and content; open application platform for other app developers that allows users to log into third-party applications with their Weibo account for sharing third-party content on its platform; and Weibo Wallet, a product that enables platform partners to conduct interest generation activities on Weibo, such as handing out red envelops and coupons. The company was formerly known as T.CN Corporation and changed its name to Weibo Corporation in 2012. The company was founded in 2009 and is headquartered in Beijing, the People’s Republic of China.