Zscaler (ZS) Gains As Market Dips: What You Should Know
In the latest trading session, Zscaler (ZS) closed at $155.09, marking a +0.43% move from the previous day. This change outpaced the S&P 500's 0.66% loss on the day. Meanwhile, the Dow lost 0.58%, and the Nasdaq, a tech-heavy index, lost 0.8%.
Coming into today, shares of the cloud-based information security provider had gained 16.42% in the past month. In that same time, the Computer and Technology sector gained 8.25%, while the S&P 500 gained 5.22%.
ZS will be looking to display strength as it nears its next earnings release. On that day, ZS is projected to report earnings of $0.06 per share, which would represent year-over-year growth of 100%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $132.38 million, up 41.45% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.29 per share and revenue of $588.87 million. These totals would mark changes of +20.83% and +36.54%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for ZS. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ZS is holding a Zacks Rank of #5 (Strong Sell) right now.
In terms of valuation, ZS is currently trading at a Forward P/E ratio of 534.53. This represents a premium compared to its industry's average Forward P/E of 38.64.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 191, putting it in the bottom 25% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.