Here's Why Zscaler (ZS) Fell More Than Broader Market

The most recent trading session ended with Zscaler (ZS) standing at $177.04, reflecting a -1.67% shift from the previouse trading day's closing. The stock's performance was behind the S&P 500's daily loss of 1.57%. Meanwhile, the Dow lost 0.84%, and the Nasdaq, a tech-heavy index, lost 2.15%.Coming into today, shares of the cloud-based information security provider had lost 7.52% in the past month. In that same time, the Computer and Technology sector lost 16.01%, while the S&P 500 lost 12.16%.The investment community will be closely monitoring the performance of Zscaler in its forthcoming earnings report. In that report, analysts expect Zscaler to post earnings of $0.75 per share. This would mark a year-over-year decline of 14.77%. Meanwhile, the latest consensus estimate predicts the revenue to be $666.11 million, indicating a 20.41% increase compared to the same quarter of the previous year.For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $3.07 per share and a revenue of $2.65 billion, representing changes of -3.76% and +22.17%, respectively, from the prior year.Any recent changes to analyst estimates for Zscaler should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate has moved 15.97% lower within the past month. As of now, Zscaler holds a Zacks Rank of #3 (Hold).With respect to valuation, Zscaler is currently being traded at a Forward P/E ratio of 58.62. This denotes a premium relative to the industry's average Forward P/E of 52.97.We can also see that ZS currently has a PEG ratio of 4.25. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ZS's industry had an average PEG ratio of 2.75 as of yesterday's close.The Security industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 147, finds itself in the bottom 41% echelons 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.Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Zscaler, Inc. (ZS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks