Zscaler (ZS) closed the most recent trading day at $232.98, moving +1.09% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.64%. Elsewhere, the Dow saw a downswing of 0.24%, while the tech-heavy Nasdaq depreciated by 0.74%.
The cloud-based information security provider's stock has climbed by 31.95% in the past month, exceeding the Computer and Technology sector's gain of 3.67% and the S&P 500's gain of 0.38%.
Market participants will be closely following the financial results of Zscaler in its upcoming release. The company's upcoming EPS is projected at $0.75, signifying a 14.77% drop compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $666.11 million, showing a 20.41% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.06 per share and revenue of $2.65 billion. These totals would mark changes of -4.08% and +22.18%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Zscaler. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 23.07% decrease. Zscaler currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Zscaler is holding a Forward P/E ratio of 75.43. This expresses a premium compared to the average Forward P/E of 66.83 of its industry.
One should further note that ZS currently holds a PEG ratio of 5.46. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Security industry stood at 3.34 at the close of the market yesterday.
The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 150, putting it in the bottom 40% 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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