Zscaler (ZS) ended the most recent trading day at $172.55, moving -1.04% from the close of the previous session. The Dow saw a decline of 0.36%, while the tech-heavy Nasdaq gained 0.21%.
Shares of the cloud-based information security provider posted a month-over-month loss of 13.64%, lagging the Computer and Technology sector’s loss of 11.22% and the S&P 500’s loss of 4.22%.
Investors will be eagerly awaiting Zscaler’s performance in the upcoming earnings release. The company is expected to report earnings per share of $0.69, up 7.81% from the year-ago quarter. Meanwhile, our current consensus estimate is projecting revenue of $567.11 million, representing growth of 24.64% from the corresponding quarter last year.
Investors should also pay attention to recent changes in analyst estimates for Zscaler. Such recent changes usually indicate a changing landscape in near-term business trends. Therefore, positive estimate revisions convey analysts’ confidence in the company’s business performance and earnings potential.
Research shows that these estimate changes are directly correlated with near-term stock price momentum. Investors can take advantage of this by using the Zacks Rank. This model takes these estimate changes into account and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has a remarkable outside-audited track record of success. #1 stocks have delivered an average annual gain of +25% since 1988. Over the past 30 days, the Zacks Consensus EPS estimate has moved 10.2% lower. Currently, Zscaler has a Zacks Rank of #3 (Hold).
Looking at valuation, Zscaler is currently trading at a P/E ratio of 53.36, which represents a premium to the industry average P/E ratio of 21.88.
It is also important to note that ZS currently has a PEG ratio of 2.02. This metric is used similarly to the well-known P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. ZS’s industry had an average PEG ratio of 1.79 as of yesterday’s close.
The Internet Services industry is part of the Computer and Technology sector. This industry, which currently has a Zacks Industry Rank of 168, ranks in the bottom 34% of all 250+ industries.
The Zacks Industry Rank evaluates the strength of our individual industry groups by looking at the average Zacks Rank of the individual stocks that make up the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to track all of these and other stock-moving metrics in the coming trading sessions.
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Zscaler, Inc. (ZS): Free Stock Analysis Report
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