Zalando SE

ZAL.SW

Specialty Retail · Consumer Cyclical

Price

CHF 25.76

-0.15 (-0.58%)

Market Cap

CHF 4.19B

Exchange

Swiss Exchange

Winston Score

Winston is serious

Mixed quality — meaningful strengths and weaknesses.

Data as of Jul 28, 2026 · filings through Mar 31, 2026

Zalando SE is a large online fashion and lifestyle marketplace based in Berlin, Germany. It sells clothing, shoes, accessories, and beauty products to consumers across Europe, serving both everyday shoppers and fashion enthusiasts. Zalando is one of Europe's largest online fashion platforms, operating in around 25 European countries.

Zalando makes money in two main ways: selling products directly to customers and charging brands and retailers a fee to sell on its platform through its Partner Program. This platform model has been growing, meaning Zalando acts more like a middleman and takes a cut rather than buying all the inventory itself. The company operates almost entirely in Europe, generating roughly €10 billion in annual revenue. Its main competitive advantage is its large customer base, wide brand selection, and strong logistics network across the continent. The key growth driver is expanding its platform business, but the main risk is intense competition from global players like Amazon and fast-fashion rivals squeezing margins.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+23.4% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

-985.4% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$125M/ year

↑ Rising (+50% vs prior year)

1.0% of revenue

Below sector average (4%)

R&D investment increasing — building for the future

Insider Activity

11.3%ownership

Insiders own a meaningful stake in the company

Cash Runway

~9 months

$1.4B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Short runway — potential dilution ahead through share issuance

Cash watch

Zalando SE has less than a year of cash at its current burn rate. Growth investors should watch for potential share dilution from future fundraising — that directly reduces your ownership.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

−0.7% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 265.0M (2021) → 263.2M (2025)

Score breakdown

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Quality

Gross Margin

39.1%

Modest — 39.1% gross margin

Operating Margin

4.3%

Thin — 4.3% operating margin

ROCE

3.8%

Weak — 3.8% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+20.1%

Fast-growing sales (20.1% YoY)

EPS YoY

-56.0%

Earnings shrinking (-56.0% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

0/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

708%

Turns 708% of profit into real cash

FCF Margin

5.5%

Thin free cash flow (5.5%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

0.24

Conservative — low debt load (0.24)

Interest Cover

7.25x

Adequate interest coverage (7.2x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

56.4x

Expensive — P/E 56.4

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+44.5

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (56.4 → 11.8)

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Dividends

Not applicable for this business.

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