Zscaler (ZS) Outperforms Broader Market: What You Need to Know

Company Overview - Zscaler (ZS) closed at $219.86, with a +1.99% change from the previous day, outperforming the S&P 500's daily gain of 0.06% [1] - Over the past month, Zscaler shares gained 4.07%, contrasting with the Computer and Technology sector's loss of 5.52% and the S&P 500's loss of 4.29% [1] Earnings Expectations - The upcoming earnings release is expected to show an EPS of $0.75, a 14.77% decrease compared to the same quarter last year [2] - Revenue is forecasted to be $666.11 million, indicating a 20.41% growth year-over-year [2] Full-Year Estimates - Full-year Zacks Consensus Estimates predict earnings of $3.06 per share and revenue of $2.65 billion, reflecting year-over-year changes of -4.08% and +22.18%, respectively [3] - Recent revisions to analyst forecasts are crucial as they reflect near-term business trends, with positive changes indicating analyst optimism [3] Valuation Metrics - Zscaler's Forward P/E ratio is 70.56, which is higher than the industry average of 63.04, indicating a premium valuation [6] - The current PEG ratio stands at 5.11, compared to the Security industry's average PEG ratio of 3.2 [6] Industry Context - The Security industry is part of the Computer and Technology sector and holds a Zacks Industry Rank of 160, placing it in the bottom 36% of over 250 industries [7] - The Zacks Industry Rank assesses the performance of industry groups based on the average Zacks Rank of individual stocks, with the top 50% rated industries outperforming the bottom half by a factor of 2 to 1 [7]