QualityDipStocks / Consumer Discretionary · Apparel
Ermenegildo Zegna ZGN
Outside our quality screen, so we don’t track its dips. It’s 8% below its 52-week high.
Outside our quality screen, trading well below our fair value estimate.
- Fair value est.
- $23.82+70%
- Market Value
- —
- Off 52-wk high
- −8%
- Risk vs market
- Above marketbeta 1.14
5 bullish · 5 bearish See why
Valuation
What we estimate it's worth, and how it ranks on value vs every stock we cover.
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 8.7% ±2 points. Bear = 10.5% and 6.7%; bull = 8.5% and 10.7% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is below even the bear case.
What the price implies To be worth today’s price, ZGN’s free cash flow would need to shrink about 1% a year for five years; our estimate uses 9%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 31 to Nov 2, 252 sessions). Beta = how much ZGN moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Swings more than the market, and its own price swings are 3.2× the S&P 500’s.
- Beta vs S&P 500
- 1.14
- Volatility
- 41% vs 13% SPY
- Correlation SPY
- 0.35
- Correlation QQQ
- 0.22
How it ranks
Where ZGN stands vs every one of the 1,996 stocks we cover that has the number. Longer bar = better.
Top quarter on 2 of 6 measures
- Discount to fair value estimate70% · price below our base caseTop 16%of 1,314
- Free cash flow yield7.8% · free cash flow vs market capTop 19%of 1,391
- Dividends + buybacks yield0.9% · cash paid out or used to retire shares, vs market capLowest 29%of 1,836
- Revenue growth, last 12 months−1.5% · vs the 12 months beforeLowest 9%of 1,814
- Operating margin7.3% · of sales kept as operating profitLowest 33%of 1,288
- Return on invested capital12% · profit per dollar of capitalTop 41%of 838
From SEC filings and our fair value estimate model. A ranking, not advice.
Valuation details
DCF $23.82 · FCF value $26.77
Assumes 8.7% growth for 5 years (revenue grew 8.7% a year FY22–FY25), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $1.09 a share (fiscal year to Dec 31, 2025, converted from EUR at 1.12), from the 20-F filed Mar 20, 2026. Net debt $123M, not deducted.
Fundamentals
The business itself: sales, profits, cash and debt, from SEC filings.
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ValuationOur DCF fair value estimate is $23.82, 70% above the price.
ValuationFree-cash-flow yield of 7.8% (price / FCF 12.8×): $286M of free cash in the last 12 months.
Cash returnsFree cash flow grew 42% over the last 12 months vs the 12 months before.
Balance sheetNet cash of $152M: cash and short-term investments exceed debt (Dec 31, 2025).
ProfitabilityGross margin widened to 67.5% in FY2025 from 64.3% in FY2023 (SEC filings).
Top bearish points 5 of 5
Balance sheetOperating income covers interest only 2.8× over the last 12 months.
GrowthSales growth slowed to −2% over the last 12 months, from 9% a year over the prior three fiscal years.
ProfitabilityOperating margin narrowed to 7.3% in FY2025 from 10.9% in FY2023 (SEC filings).
ValuationP/E of 33.2× vs a 20.7× median for the 341 Consumer Discretionary companies we cover.
QualityDoesn’t pass our quality screen: ROE under 12% and ROIC under 10%; net debt 5.5× EBITDA (limit 3×).
All fundamentals
P/E 33.2 · FCF yield 7.8% · ROE 10%
Valuation
- P/E
- 33.2×Consumer Discretionary median 20.7×
- Price / FCF
- 12.8×
- FCF yield
- 7.8%
- EV / EBITDA
- 8.2×
- Price / sales
- 1.71×
- Price / book
- 3.18×
- Market cap
- $3.7Bprice × diluted shares
- Enterprise value
- $3.5B
Growth
- Revenue, 12 months
- $2.1B
- Sales growth, 12 months
- −1.5%vs the 12 months before
- Sales growth, 3 yrs
- +8.7%/yrfrom FY2022
- Diluted EPS, 12 months
- $0.38
- EPS growth, last FY
- +26.7%
- Net income, 12 months
- $110M
- Net income growth
- +28%12 months vs before
Profitability
- Gross margin
- 67.5%
- Operating margin
- 7.3%
- Net margin
- 5.1%
- FCF margin
- 13.3%
- Return on equity
- 10%
- Return on invested capital
- 12%
Balance sheet
- Cash & short-term inv.
- $246M
- Total debt
- $94M
- Net cash
- $152M
- Debt / equity
- 0.08×
- Interest coverage
- 2.8×operating income / interest
Cash flow & returns
- Free cash flow, 12 months
- $286M
- FCF growth, 12 months
- +42%
- Dividend yield
- 0.93%$34M paid
- Payout ratio
- 31%
- Buybacks, 12 months
- n/anot reported in its SEC filings
- Share count, 1 year
- n/ano quarterly diluted share count
- Stock-based comp
- n/anot reported in its SEC filings
Trailing 12 months to Dec 31, 2025; balance sheet at Dec 31, 2025. From Ermenegildo Zegna’s SEC filings, reported in EUR and converted to US dollars. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
The business
FCF $0.3B · Sales +6%
- Free cash flow, 12 months$0.3B
- Free-cash-flow yield7.8%
- Free-cash-flow margin14%
- Gross margin68%
- Operating margin7%
- Return on invested capital6%
- Return on equity9%
- Sales growth (latest quarter vs year-ago quarter)+6%
- Net debt / EBITDA5.5×
Chart & levels
Where the price is vs its key levels and trends.
Key levels
Every level vs today’s $14.03
- 52-wk lowlowest close, 1 year$8.69−38.1%
- PriceMon Nov 2 close$14.03you are here
- 52-wk highhighest close, 1 year$15.25+8.7%
- Fair value est.base case$23.82+69.8%
Momentum & 52-week range
RSI 66 · 5 days +4.6%
Signals
Reversal signal setups, the public ledger and the next earnings date.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. Reversal signal rules only run on companies that pass our quality screen.
ZGN is outside our quality screen
One text when a published rule fires on one of the 332 quality companies we track: the ticker, the price, the stop and a link to the numbers. Nothing else.
Voices & buzz
Who is talking about it, and how it compares with peers.
Who’s talking about it
Notable investors, executives, analysts and public figures on Ermenegildo Zegna in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 3, 1:01 PM ET.
Compare with peers
Closest in size in Apparel
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.