Comparing Zillow Group (NASDAQ:ZG) and Freddie Mac (OTCMKTS:FMCC)

Zillow Group (NASDAQ:ZG) and Freddie Mac (OTCMKTS:FMCC) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, dividends, earnings and risk.

Analyst Ratings

This is a breakdown of current ratings and target prices for Zillow Group and Freddie Mac, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zillow Group	1	11	13	0	2.48
Freddie Mac	1	0	0	0	1.00

Zillow Group currently has a consensus price target of $85.6190, indicating a potential upside of 10.36%. Freddie Mac has a consensus price target of $4.50, indicating a potential downside of 49.44%. Given Zillow Group’s stronger consensus rating and higher possible upside, research analysts clearly believe Zillow Group is more favorable than Freddie Mac.

Risk and Volatility

Zillow Group has a beta of 2.07, suggesting that its share price is 107% more volatile than the S&P 500. Comparatively, Freddie Mac has a beta of 2.06, suggesting that its share price is 106% more volatile than the S&P 500.

Insider and Institutional Ownership

20.3% of Zillow Group shares are owned by institutional investors. 17.1% of Zillow Group shares are owned by insiders. Comparatively, 0.1% of Freddie Mac shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Zillow Group and Freddie Mac’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zillow Group	-2.60%	-1.26%	-1.04%
Freddie Mac	9.04%	-44.33%	0.34%

Earnings & Valuation

This table compares Zillow Group and Freddie Mac”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zillow Group	$2.24 billion	8.41	-$112.00 million	($0.26)	-298.38
Freddie Mac	$122.05 billion	0.05	$11.86 billion	($0.03)	-296.67

Freddie Mac has higher revenue and earnings than Zillow Group. Zillow Group is trading at a lower price-to-earnings ratio than Freddie Mac, indicating that it is currently the more affordable of the two stocks.

Summary

Zillow Group beats Freddie Mac on 8 of the 14 factors compared between the two stocks.

About Zillow Group

Zillow Group, Inc. operates real estate brands in mobile applications and Websites in the United States. The company offers premier agent and rentals marketplaces, new construction marketplaces, advertising, display advertising, and business technology solutions, as well as dotloop and floor plans. It also provides mortgage originations and the sale of mortgages, and advertising to mortgage lenders and other mortgage professionals; and title and escrow services. In addition, the company's brand portfolio includes Zillow Premier Agent, Zillow Home Loans, Zillow Rentals, Trulia, StreetEasy, HotPads, and Out East; and a suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce, and Follow Up Boss. Zillow Group, Inc. was incorporated in 2004 and is headquartered in Seattle, Washington.

About Freddie Mac

Federal Home Loan Mortgage Corporation operates in the secondary mortgage market in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment purchases, securitizes, and guarantees single-family loans; and manages single-family mortgage credit and market risk, as well as manages mortgage-related investments portfolio, single-family securitization activities, and treasury functions. This segment serves mortgage banking companies, commercial banks, regional banks, community banks, credit unions, housing finance agencies, savings institutions, and non-depository financial institutions. The Multifamily segment engages in the purchase, securitization, and guarantee of multifamily loans; issuance of multifamily K certificates; manages multifamily mortgage credit and market risk; and invests in multifamily loans and mortgage-related securities. It serves banks and other financial institutions, insurance companies, money managers, hedge funds, pension funds, state and local governments, and broker dealers. Federal Home Loan Mortgage Corporation incorporated in 1970 and is headquartered in McLean, Virginia.