The most recent trading session ended with Zscaler (ZS) standing at $196.52, reflecting a +1.46% shift from the previouse trading day's closing. This change lagged the S&P 500's 2.51% gain on the day. Meanwhile, the Dow experienced a rise of 2.66%, and the technology-dominated Nasdaq saw an increase of 2.71%.
Prior to today's trading, shares of the cloud-based information security provider had lost 7.7% over the past month. This has was narrower than the Computer and Technology sector's loss of 12.18% and the S&P 500's loss of 8.86% in that time.
The upcoming earnings release of Zscaler will be of great interest to investors. The company's upcoming EPS is projected at $0.76, signifying a 13.64% drop compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $666.11 million, indicating a 20.41% growth compared to the corresponding quarter of the prior year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $3.08 per share and revenue of $2.65 billion, indicating changes of -3.45% and +22.17%, respectively, compared to the previous year.
It is also important to note the recent changes to analyst estimates for Zscaler. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.44% lower within the past month. Zscaler currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Zscaler is holding a Forward P/E ratio of 62.92. This indicates a premium in contrast to its industry's Forward P/E of 56.29.
One should further note that ZS currently holds a PEG ratio of 4.56. 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. ZS's industry had an average PEG ratio of 2.92 as of yesterday's close.
The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 89, which puts it in the top 36% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming 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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Zscaler, Inc. (ZS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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