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Strength Seen in Zscaler (ZS): Can Its 12.4% Jump Turn into More Strength?
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Zscaler (ZS - Free Report) shares ended the last trading session 12.4% higher at $194.20. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 11.8% loss over the past four weeks.
The upswing came after Zscaler reported impressive third-quarter 2021 results and raised the full-year outlook. Zscaler delivered third-quarter non-GAAP earnings per share of 15 cents, beating the Zacks Consensus Estimate of 7 cents. The reported figure also improved significantly from the year-ago quarter’s earnings of 7 cents per share. Moreover, revenues of $176.4 million surpassed the consensus mark of $164.4 million and increased 60% year over year.
Buoyed by the impressive quarterly performance, the company raised its guidance for full-year 2021, creating an optimism among investors.
Notably, strategic investments in developing powerful products and services, efforts to expand into adjacent addressable markets and boost the firm’s global sales force is benefiting the company.
Moreover, an increasing number of people logging into employers' networks is triggering a greater need for security. This trend is spurring demand for Zscaler’s products. Increasing demand for the company’s edge cloud for policy enforcement, multi-tenancy, proxy for SSL or TLS inspection and zero trust network access, is an indicator of this.
Price and Consensus
This cloud-based information security provider is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of +80%. Revenues are expected to be $174.02 million, up 38.2% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Zscaler, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on ZS going forward to see if this recent jump can turn into more strength down the road.
Image: Shutterstock
Strength Seen in Zscaler (ZS): Can Its 12.4% Jump Turn into More Strength?
Zscaler (ZS - Free Report) shares ended the last trading session 12.4% higher at $194.20. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 11.8% loss over the past four weeks.
The upswing came after Zscaler reported impressive third-quarter 2021 results and raised the full-year outlook. Zscaler delivered third-quarter non-GAAP earnings per share of 15 cents, beating the Zacks Consensus Estimate of 7 cents. The reported figure also improved significantly from the year-ago quarter’s earnings of 7 cents per share. Moreover, revenues of $176.4 million surpassed the consensus mark of $164.4 million and increased 60% year over year.
Buoyed by the impressive quarterly performance, the company raised its guidance for full-year 2021, creating an optimism among investors.
Notably, strategic investments in developing powerful products and services, efforts to expand into adjacent addressable markets and boost the firm’s global sales force is benefiting the company.
Moreover, an increasing number of people logging into employers' networks is triggering a greater need for security. This trend is spurring demand for Zscaler’s products. Increasing demand for the company’s edge cloud for policy enforcement, multi-tenancy, proxy for SSL or TLS inspection and zero trust network access, is an indicator of this.
Price and Consensus
This cloud-based information security provider is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of +80%. Revenues are expected to be $174.02 million, up 38.2% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Zscaler, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on ZS going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>