Critical Contrast: Zayo Group (NYSE:ZAYO) vs. The Competition

Zayo Group (NYSE: ZAYO) is one of 73 publicly-traded companies in the “Telephone communication, except radio” industry, but how does it weigh in compared to its rivals? We will compare Zayo Group to related companies based on the strength of its earnings, dividends, analyst recommendations, valuation, institutional ownership, risk and profitability.

Institutional & Insider Ownership

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87.3% of Zayo Group shares are held by institutional investors. Comparatively, 46.9% of shares of all “Telephone communication, except radio” companies are held by institutional investors. 5.2% of Zayo Group shares are held by company insiders. Comparatively, 7.3% of shares of all “Telephone communication, except radio” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Zayo Group has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, Zayo Group’s rivals have a beta of 0.59, suggesting that their average stock price is 41% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Zayo Group and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zayo Group 0 5 13 0 2.72
Zayo Group Competitors 608 1860 1943 98 2.34

Zayo Group presently has a consensus price target of $41.90, indicating a potential upside of 15.75%. As a group, “Telephone communication, except radio” companies have a potential upside of 69.59%. Given Zayo Group’s rivals higher probable upside, analysts plainly believe Zayo Group has less favorable growth aspects than its rivals.

Profitability

This table compares Zayo Group and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zayo Group 3.42% 10.19% 1.67%
Zayo Group Competitors -12.56% -11.21% -0.99%

Valuation & Earnings

This table compares Zayo Group and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Zayo Group $2.20 billion $85.70 million 90.50
Zayo Group Competitors $17.40 billion $2.02 billion 17.66

Zayo Group’s rivals have higher revenue and earnings than Zayo Group. Zayo Group is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Summary

Zayo Group beats its rivals on 7 of the 13 factors compared.

Zayo Group Company Profile

Zayo Group Holdings, Inc., through its subsidiaries, provides bandwidth infrastructure solutions for the communications industry in the United States, Canada, and Europe. The company operates in six segments: Fiber Solutions, Transport, Enterprise Networks, Zayo Colocation (zColo), Allstream, and Other. The Fiber Solutions segment provides dark fiber, and fiber-to-the-tower and small cell mobile infrastructure services for carriers and other communication service providers, Internet service providers, wireless service providers, media and content companies, large enterprises, and other companies. The Transport segment offers lit bandwidth infrastructure solutions comprising wavelength, wholesale IP services, and SONET services through its metro, regional, and long-haul fiber networks for carriers, content providers, financial services companies, healthcare, government entities, education institutions, and other medium and large enterprises. The Enterprise Networks segment provides communication solutions, such as Ethernet, enterprise private and connectivity services, managed services, and cloud based compute and storage products to medium and large enterprises. The Zayo Colocation (zColo) segment offers data center infrastructure solutions, including colocation space, and power and interconnection services to a range of enterprise, carrier, cloud, and content customers. The Allstream segment provides Internet protocol (IP), Internet, voice, IP trunking, cloud private branch exchange, and collaboration services, as well as unified communications for small and medium business customers. The Other segment provides network and technical resources to customers in designing, acquiring, and maintaining their networks. Zayo Group Holdings, Inc. was founded in 2007 and is headquartered in Boulder, Colorado.

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