Zscaler (ZS) ended the recent trading session at $272.50, demonstrating a -5.81% change from the preceding day's closing price. This change lagged the S&P 500's daily loss of 0.08%. On the other hand, the Dow registered a loss of 0.51%, and the technology-centric Nasdaq increased by 0.35%.
Prior to today's trading, shares of the cloud-based information security provider had lost 8.59% lagged the Computer and Technology sector's gain of 3.95% and the S&P 500's gain of 1.21%.
Investors will be eagerly watching for the performance of Zscaler in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.8, indicating a 9.09% decline compared to the equivalent quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $706.19 million, indicating a 19.11% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $3.18 per share and revenue of $2.66 billion, which would represent changes of -0.31% and 0%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Zscaler. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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 past month, there's been no change in the Zacks Consensus EPS estimate. Zscaler currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Zscaler is holding a Forward P/E ratio of 81.13. For comparison, its industry has an average Forward P/E of 64.23, which means Zscaler is trading at a premium to the group.
It's also important to note that ZS currently trades at a PEG ratio of 5.62. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Security industry had an average PEG ratio of 2.9 as trading concluded yesterday.
The Security industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 100, this industry ranks in the top 41% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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Zscaler, Inc. (ZS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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