Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, online real estate marketplace operator Zillow (Nasdaq: Z) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Zillow's business and see what CAPS investors are saying about the stock right now.

Zillow facts

Headquarters (Founded) Seattle (2004)
Market Cap $679.8 million
Industry Internet software and services
Trailing-12-Month Revenue $55.7 million
Management Co-Founder/Chairman Richard Barton
CEO Spencer Rascoff
Trailing-12-Month Operating Margin 2.8%
Cash/Debt $95.8 million / $0

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 70% of the 176 members who have rated Zillow believe the stock will underperform the S&P 500 going forward. These bears include All-Star BeatBuffet, who is ranked in the top 10% of our community, and jed71.

Just last month, BeatBuffet touched on Zillow's seemingly unsustainable valuation:

The real bad news is that as a real estate agent, there are hundreds of companies competing for my advertising dollar. Zillow receives a small portion, but they have no potential for explosive growth. ... Their recent buyout of Diverse Solutions is interesting (also a Diverse Solutions customer) but once again, the stock price simply cannot be justified.

In fact, Zillow currently sports a lofty price-to-sales of 12.2. That represents a clear premium to other online real estate plays like China Real Estate Information (Nasdaq: CRIC) (2.7), LoopNet (Nasdaq: LOOP) (8.7), and Market Leader (Nasdaq: LEDR) (2.0).

CAPS member jed71 elaborates on the bear case:

Having "useful information" or "great data for homeowners" on a website is one thing. Actually leveraging that information to create an income-generating business model is something else entirely. ...

Further, the revenues are generated from what I think are less than reliable sources. They are a subscription service for real estate professionals -- I can't think of a group of professionals struggling more than those working in the real estate industry. As everyone knows, home sales are down big and it’s questionable whether Zillow will be able to continue to grow revenues under this stream. They also sell advertising to mortgage companies and other firms. ... Can they continue to grow this segment? Maybe. But I wouldn't be willing to bet on shares as expensive as these. Down thumb for now, until they have proven earnings and revenue streams can grow at a fast clip, in order to justify current valuation.

What do you think about Zillow, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.