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Zalando SE ZAL

Rating as of

Morningstar’s Analysis

Currency in EUR
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1-Star Price


5-Star Price


Economic Moat


Capital Allocation


Zalando's Growth Normalizes as Stores Reopen in Europe; Supply Chain and Inflation Short-Term Risks

Jelena Sokolova, CFA Senior Equity Analyst

Analyst Note

| Jelena Sokolova, CFA |

We do not expect to materially change our fair value estimate for no-moat Zalando shares as the company reported third-quarter results and confirmed guidance for 2021 to gross merchandize value, or GMV, growth of 31%-36% (35% in our models), revenue growth of 26%-31% (28.8% in our models), and adjusted EBIT, which excludes share-based payments and unusual items of EUR 400 million-EUR 475 million (EUR 468 million in our models). Despite the 18% drop in share price since the beginning of the year, Zalando’s shares still look somewhat expensive, as we see better value in its no-moat online apparel peer ASOS (trading in 4-star territory). Nonetheless, we believe that Zalando’s business model is more resilient (broader footprint and distribution network, less fashion risk through reliance on third-party brands) and would be buyers of the stock on further weakness.

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Company Profile

Business Description

Zalando, founded in 2008, is Europe’s biggest pure-play online fashion platform. Zalando is present in 17 European countries, and its major market is the DACH region, comprising Germany, Austria, and Switzerland, which accounts for slightly less than half of revenue. The company commands 3% of European apparel sales and 12% market share in European online apparel sales. It has 10 fulfilment centers and presents over 3,500 brands on its platform. In 2020, Zalando had 38 million active users (9% of the population in countries where the firm has a presence) and over 5 billion site visits.

Valeska-Gert-Strabe 5
Berlin, 10243, Germany
T +49 3027594693
Sector Consumer Cyclical
Industry Internet Retail
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type
Employees 16,619