Zscaler (ZS) closed at $148.19 in the latest trading session, marking a -2.56% move from the prior day. This change lagged the S&P 500's 0.38% gain on the day. Meanwhile, the Dow experienced a rise of 0.29%, and the technology-dominated Nasdaq saw an increase of 0.62%.
Heading into today, shares of the cloud-based information security provider had gained 19.54% over the past month, outpacing the Computer and Technology sector's loss of 0.53% and the S&P 500's gain of 1.61%.
The investment community will be paying close attention to the earnings performance of Zscaler in its upcoming release. The company's earnings per share (EPS) are projected to be $1.09, reflecting a 22.47% increase from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $877.19 million, up 21.96% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $4.14 per share and revenue of $3.33 billion, which would represent changes of +26.22% and +24.57%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for Zscaler. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 9.1% higher. Right now, Zscaler possesses a Zacks Rank of #3 (Hold).
In terms of valuation, Zscaler is currently trading at a Forward P/E ratio of 36.77. This represents a discount compared to its industry average Forward P/E of 52.91.
Meanwhile, ZS's PEG ratio is currently 2.51. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As of the close of trade yesterday, the Security industry held an average PEG ratio of 3.27.
The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 46, which puts it in the top 19% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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Zscaler, Inc. (ZS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).