Investing can be hard but the potential fo an individual stock to pay off big time inspires us. Mistakes are inevitable, but a single top stock pick can cover any losses, and so much more. For example, the Zscaler, Inc. (NASDAQ:ZS) share price is up a whopping 560% in the last three years, a handsome return for long term holders. On top of that, the share price is up 19% in about a quarter.
It really delights us to see such great share price performance for investors.
Given that Zscaler didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last 3 years Zscaler saw its revenue grow at 39% per year. That's well above most pre-profit companies. And it's not just the revenue that is taking off. The share price is up 88% per year in that time. Despite the strong run, top performers like Zscaler have been known to go on winning for decades. So we'd recommend you take a closer look at this one, or even put it on your watchlist.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).NasdaqGS:ZS Earnings and Revenue Growth July 28th 2021
It's probably worth noting that the CEO is paid less than the median at similar sized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
We're pleased to report that Zscaler rewarded shareholders with a total shareholder return of 87% over the last year. That falls short of the 88% it has made, for shareholders, each year, over three years. It's always interesting to track share price performance over the longer term. But to understand Zscaler better, we need to consider many other factors. For example, we've discovered 4 warning signs for Zscaler that you should be aware of before investing here.
We will like Zscaler better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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