Zscaler (ZS) closed the most recent trading day at $136.21, moving +0.41% from the previous trading session. This change outpaced the S&P 500’s 0.02% loss on the day. At the same time, the Dow added 0.08%, and the tech-heavy Nasdaq lost 0.2%.
Heading into today, shares of the cloud-based information security provider had lost 8.28% over the past month, lagging the Computer and Technology sector’s loss of 6.18% and the S&P 500’s loss of 3.25% in that time.
Investors will be hoping for strength from Zscaler as it approaches its next earnings release, which is expected to be September 5, 2023. The company is expected to report EPS of $0.49, up 96% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $430.42 million, up 35.33% from the prior-year quarter.
It is also important to note the recent changes to analyst estimates for Zscaler. 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.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Zscaler is holding a Zacks Rank of #2 (Buy) right now.
Investors should also note Zscaler’s current valuation metrics, including its Forward P/E ratio of 64.45. This represents a premium compared to its industry’s average Forward P/E of 31.3.
We can also see that ZS currently has a PEG ratio of 1.06. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Internet – Services stocks are, on average, holding a PEG ratio of 2.25 based on yesterday’s closing prices.
The Internet – Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% 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.
To follow ZS in the coming trading sessions, be sure to utilize Zacks.com.
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Zscaler, Inc. (ZS) : Free Stock Analysis Report
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