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Zscaler (ZS) to Report Q4 Earnings: What's in the Cards?

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Zscaler (ZS - Free Report) is set to report fourth-quarter fiscal 2020 results on Sep 9.

For the quarter, the company projects total revenues between $117 million and $119 million. Moreover, non-GAAP earnings are expected between 2 cents and 3 cents per share.

The Zacks Consensus Estimate for revenues is pegged at $118.4 million, indicating an increase of 37.5% from the year-ago quarter’s reported figure. Moreover, the consensus mark for earnings has remained unchanged at 3 cents per share over the past 30 days.

Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average being 312.5%.

Zscaler, Inc. Price, Consensus and EPS Surprise

Zscaler, Inc. Price, Consensus and EPS Surprise

Zscaler, Inc. price-consensus-eps-surprise-chart | Zscaler, Inc. Quote

Factors to Consider

Zscaler’s quarterly results are expected to reflect benefits from continued solid demand for its products, given the healthy environment of the global security market.

Also, a huge global workforce is working remotely in an effort to contain the spread of coronavirus. However, an increasing number of people logging into employers' networks has been triggering a greater need for security. This trend might have spurred demand for Zscaler’s products in the fiscal fourth quarter.

Furthermore, Zscaler’s quarterly results are likely to reflect robust growth in subscription revenues. Increasing number of net new subscription customers might have been a key tailwind as well.

Nonetheless, increased investment in enhancing sales and marketing capabilities and higher research and development expenses are likely to have weighed on the company’s bottom-line results.

What Our Model Says

Our proven model predicts an earnings beat for Zscaler this earnings season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Zscaler has an Earnings ESP of +21.74% and a Zacks Rank of 2.

Some More Stocks With Favorable Combination

Here are some more companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming release:

Caseys General Stores, Inc. (CASY - Free Report) has an Earnings ESP of +4.79% and currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Peloton Interactive (PTON - Free Report) has an Earnings ESP of +68.32% and carries a Zacks Rank of 3, at present.

AutoZone (AZO - Free Report) has an Earnings ESP of +5.62% and carries a Zacks Rank of 3, currently.

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