Should You Invest in ZipRecruiter?

OVERVIEW

ZipRecruiter Incorporation is a company based in the United States. The company operates a job hiring site and app around the world. The company posts job listings on its website as well as hundreds of other job boards on the internet. Companies and people can reach out to one another for the job application process as well. It was founded in 2010.

Why You Should?

  1. ZipRecruiter is a great reopening play in an investor’s portfolio. As the pandemic took hold around the nation, the company saw a drop in demand for its job listing and other related services. However, as the economy reopens, the number of job listings soared and companies wanted to connect with people to grow their employee base.
  2. A labor shortage will further benefit ZipRecruiter. Companies who are looking for employees will go to innovative company’s like ZipRecruiter in order to increase viewership of their job posting. As this labor shortage and the rush of demand for company’s looking for employees, the company will see strong growth over the short to mid-term.
  3. ZipRecruiter has innovated in the job posting and hiring market. The company has monetized services in order to increase viewership for job listings on its website by posting them on many other job boards on the internet. In addition to this, the company reaches out to people who might be interested in applying for a specific job. It also offers its users data for over 7.5 million jobs.
  4. ZipRecruiter is extremely popular with companies and users around the world. This has helped the company grow its revenue and has also helped it make its first full year of profits in 2020. The company is one of the few new startups that have listed their stocks on Wall Street to also be profitable. If this growth continues, I think that ZipRecruiter will be a good stock.

Why You Should Not?

  1. The company faces tough competition in the job application and hiring market. Some of these include Indeed, LinkedIn, Glassdoor, and many others. This competition might hurt the company and its investors in the future.
  2. Labor shortages might also hurt the company. Though job listings are on the rise, people are not interested in going to work at these places now. This might cause the company to see a drop in demand for some hiring and job listing services. This might also hurt investors in the company in the short to mid-term.
  3. ZipRecruiter still has a fairly expensive stock price. The company’s stock trades at around 187 times earnings (stock price/earnings per share), something that makes the company’s stock volatile. This is because investors are expecting great results from the company, which might make the stock price volatile.

MY OPINION

I think that ZipRecruiter is a great long-term investment due to its position as a good reopening play, labor shortages, innovation in the job hiring and application industry, as well as its profitability. However, tough competition, negative impacts from labor shortages, as well as an expensive stock price might hurt the company and its investors in the future.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Aaditya Patel

Aaditya Patel

2 Followers

Aaditya Patel is a writer who publishes analysis on companies publicly traded on the NYSE. Follow him @the_investing787 on Instagram for summary posts.