NEW YORK (TheStreet) -- Zillow
(Z - Get Report) announced that it acquired rival online real estate information provider Trulia
(TRLA) for $3.5 billion in stock on Monday.
Trulia shareholders will receive 0.444 shares of Zillow for every Trulia stock they own as part of the deal, equivalent to a combined one-third stake in the new company.
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The acquisition is expected to close next year.
Zillow shares are down -2.9% to $154.27 in pre-market trading, while Trulia shares are up 16.7% to $65.78 today.
- Z's very impressive revenue growth greatly exceeded the industry average of 11.5%. Since the same quarter one year prior, revenues leaped by 70.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Z has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 8.42, which clearly demonstrates the ability to cover short-term cash needs.
- The gross profit margin for ZILLOW INC is currently very high, coming in at 92.64%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -9.44% is in-line with the industry average.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 67.0% when compared to the same quarter one year ago, falling from -$3.75 million to -$6.26 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Internet Software & Services industry and the overall market, ZILLOW INC's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: Z Ratings Report