Zscaler (ZS) Dips More Than Broader Markets: What You Should Know
Zacks Investment Research | May 02, 2019 05:50AM ET
Zscaler (ZS) closed at $65.67 in the latest trading session, marking a -0.76% move from the prior day. This change lagged the S&P 500's 0.21% loss on the day. At the same time, the Dow lost 0.46%, and the tech-heavy Nasdaq lost 0.16%.
Coming into today, shares of the cloud-based information security provider had lost 4.57% in the past month. In that same time, the Computer and Technology sector gained 3.11%, while the S&P 500 gained 2.07%.
Investors will be hoping for strength from ZS as it approaches 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 400%. Our most recent consensus estimate is calling for quarterly revenue of $74.54 million, up 51.63% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.12 per share and revenue of $290.32 million. These totals would mark changes of +192.31% and +52.66%, respectively, from last year.
Any recent changes to analyst estimates for ZS should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ZS is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that ZS has a Forward P/E ratio of 543.86 right now. For comparison, its industry has an average Forward P/E of 34.83, which means ZS is trading at a premium to the group.
The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 196, which puts it in the bottom 24% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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