Zhihu Inc.
Zhihu Inc. Fundamental Analysis
Zhihu Inc. (ZH) shows weak financial fundamentals with a PE ratio of 18.02, profit margin of 3.46%, and ROE of 2.50%. The company generates $3.0B in annual revenue with weak year-over-year growth of -14.29%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 20.4/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ZH's fundamental strength across five key dimensions:
Efficiency Score
WeakZH struggles to generate sufficient returns from assets.
Valuation Score
ExcellentZH trades at attractive valuation levels.
Growth Score
ModerateZH shows steady but slowing expansion.
Financial Health Score
ExcellentZH maintains a strong and stable balance sheet.
Profitability Score
WeakZH struggles to sustain strong margins.
Key Financial Metrics
Is ZH Expensive or Cheap?
P/E Ratio
ZH trades at 18.02 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, ZH's PEG of -0.09 indicates potential undervaluation.
Price to Book
The market values Zhihu Inc. at 0.46 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 52.39 times EBITDA. This signals the market has high growth expectations.
How Well Does ZH Make Money?
Net Profit Margin
For every $100 in sales, Zhihu Inc. keeps $3.46 as profit after all expenses.
Operating Margin
Core operations generate -7.76 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $2.50 in profit for every $100 of shareholder equity.
ROA
Zhihu Inc. generates $1.87 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Zhihu Inc. generates limited operating cash flow of $0.00, signaling weaker underlying cash strength.
Free Cash Flow
Zhihu Inc. generates weak or negative free cash flow of $0.00, restricting financial flexibility.
FCF Per Share
Each share generates $0.00 in free cash annually.
FCF Yield
ZH converts 0.00% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
18.02
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.09
vs 25 benchmark
P/B Ratio
Price to book value ratio
0.46
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.62
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.04
vs 25 benchmark
Current Ratio
Current assets to current liabilities
3.69
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.02
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
-0.06
vs 25 benchmark
How ZH Stacks Against Its Sector Peers
| Metric | ZH Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 18.02 | 21.28 | Better (Cheaper) |
| ROE | 2.50% | 1116.00% | Weak |
| Net Margin | 3.46% | -55475.00% (disorted) | Weak |
| Debt/Equity | 0.04 | 1.38 | Strong (Low Leverage) |
| Current Ratio | 3.69 | 1.61 | Strong Liquidity |
| ROA | 1.87% | -204822.00% (disorted) | Weak |
ZH outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Zhihu Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
489.56%
Industry Style: Growth, Technology, Streaming
High GrowthEPS CAGR
81.21%
Industry Style: Growth, Technology, Streaming
High GrowthFCF CAGR
56.99%
Industry Style: Growth, Technology, Streaming
High Growth