Zscaler (ZS) closed at $187.55 in the latest trading session, marking a -1.28% move from the prior day. This change lagged the S&P 500's daily loss of 0.21%. Elsewhere, the Dow lost 0.16%, while the tech-heavy Nasdaq lost 0.89%.
The cloud-based information security provider's stock has climbed by 2.32% in the past month, exceeding the Computer and Technology sector's loss of 2.15% and the S&P 500's loss of 1.56%.
Investors will be eagerly watching for the performance of Zscaler in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.69, indicating a 9.21% decline compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $634.11 million, up 20.78% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $2.99 per share and revenue of $2.64 billion, which would represent changes of -6.27% and +21.58%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for Zscaler. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 33.85% higher. Right now, Zscaler possesses a Zacks Rank of #2 (Buy).
In the context of valuation, Zscaler is at present trading with a Forward P/E ratio of 63.5. This signifies a premium in comparison to the average Forward P/E of 22.06 for its industry.
Meanwhile, ZS's PEG ratio is currently 4.71. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Internet - Services industry was having an average PEG ratio of 1.54.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 49, putting it in the top 20% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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