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Zscaler (ZS) Rises As Market Takes a Dip: Key Facts

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In the latest market close, Zscaler (ZS - Free Report) reached $191.07, with a +1.41% movement compared to the previous day. The stock's change was more than the S&P 500's daily loss of 0.16%. Meanwhile, the Dow lost 0.14%, and the Nasdaq, a tech-heavy index, lost 0.06%.

The cloud-based information security provider's stock has climbed by 4.06% in the past month, exceeding the Computer and Technology sector's gain of 0.47% and the S&P 500's gain of 1.96%.

The upcoming earnings release of Zscaler will be of great interest to investors. In that report, analysts expect Zscaler to post earnings of $0.69 per share. This would mark year-over-year growth of 7.81%. Alongside, our most recent consensus estimate is anticipating revenue of $567.19 million, indicating a 24.65% upward movement from the same quarter last year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.99 per share and a revenue of $2.14 billion, indicating changes of +67.04% and +32.39%, respectively, from the former year.

Investors should also note any recent changes to analyst estimates for Zscaler. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Zscaler currently has a Zacks Rank of #2 (Buy).

In the context of valuation, Zscaler is at present trading with a Forward P/E ratio of 63.07. For comparison, its industry has an average Forward P/E of 23.84, which means Zscaler is trading at a premium to the group.

Investors should also note that ZS has a PEG ratio of 2.38 right now. 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. By the end of yesterday's trading, the Internet - Services industry had an average PEG ratio of 2.27.

The Internet - Services industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 89, positioning it in the top 36% 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.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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