uploads/2015/09/zayo-npm.jpg

How Does Zayo Group Holdings Compare to Its Peers?

By

Updated

Zayo Group Holdings and its peers

An analysis of Zayo Group’s income statement in 4Q15 follows:

  • The net profit margins of Zayo Group Holdings (ZAYO), Time Warner Cable (TWC), Centurylink (CTL), Equinix (EQIX), and Cogent Communications Holdings (CCOI) are 1.40%, 7.81%, 3.24%, 8.93%, and 0.85%, respectively.

zayo-npm

An analysis of Zayo Group’s valuations follows:

  • The PBV (price-to-book value) ratios of Zayo Group, Level 3 Communications, Centurylink, and Equinix are 6.03x, 2.41x, 0.98x, and 7.38x, respectively.

Zayo Group’s peers have outperformed it based on the net profit margin. However, based on the PBV ratio, Zayo Group is way ahead of its peers.

Article continues below advertisement

ETFs that invest in Zayo Group

The Vanguard Telecommunications Services ETF (VOX) invests 1.15% of its holdings in Zayo Group. VOX tracks a highly concentrated, market-cap-weighted index of US telecommunications companies.

The Guggenheim Raymond James SB-1 Equity ETF (RYJ) invests 0.66% of its holdings in Zayo Group. RYJ tracks an equal-weighted index of US-listed stocks expected by analysts to achieve a 15% total return and outperform S&P 500 over the next six to 12 months.

The First Trust US IPO (FPX) invests 0.57% of its holdings in Zayo Group. It tracks a market-cap-weighted index of the 100 largest US IPOs (initial pubic offerings) over the first 1,000 trading days of each stock. The stocks must pass additional quantitative screens to make it into the index.

Zayo Group compared to its ETFs

An analysis of Zayo Group’s price movement follows:

  • The YTD (year-to-date) price movements of Zayo Group, VOX, RYJ, and FPX are -5.46%, -0.21%, -0.86%, and 4.94%, respectively.

An analysis of Zayo Group’s valuation follows:

  • The PBV ratios of Zayo Group, VOX, RYJ, and FPX are 6.03x, 2.53x, 2.22x, and 3.72, respectively.

According to the above findings, the ETFs have outperformed Zayo Group based on the price movement. However, Zayo Group is way ahead of its ETFs based on the PBV ratio.

Advertisement

More From Market Realist