ZSCALER INC (ZS) Stock Fundamental Analysis
USA - NASDAQ:ZS - US98980G1022 - Common Stock
310.37 USD
+4.47 (+1.46%)
310.37 USD
0 (0%)
ZS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 285 industry peers in the Software industry. The financial health of ZS is average, but there are quite some concerns on its profitability. ZS is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
ZS had positive earnings in the past year.
ZS had a positive operating cash flow in the past year.
ZS had negative earnings in each of the past 5 years.
In the past 5 years ZS always reported a positive cash flow from operatings.
1.2 Ratios
ZS has a Return On Assets (-0.65%) which is in line with its industry peers.
ZS's Return On Equity of -2.31% is in line compared to the rest of the industry. ZS outperforms 57.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.65% | ||
| ROE | -2.31% | ||
| ROIC | N/A |
ROA(3y)-2.49%
ROA(5y)-6.57%
ROE(3y)-11.58%
ROE(5y)-30.47%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
ZS has a better Gross Margin (76.87%) than 72.63% of its industry peers.
ZS's Gross Margin has been stable in the last couple of years.
The Profit Margin and Operating Margin are not available for ZS so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 76.87% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.4%
GM growth 5Y-0.23%
2. Health
2.1 Basic Checks
ZS does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for ZS has been increased compared to 1 year ago.
The number of shares outstanding for ZS has been increased compared to 5 years ago.
ZS has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 6.84 indicates that ZS is not in any danger for bankruptcy at the moment.
ZS's Altman-Z score of 6.84 is fine compared to the rest of the industry. ZS outperforms 76.14% of its industry peers.
ZS has a debt to FCF ratio of 2.34. This is a good value and a sign of high solvency as ZS would need 2.34 years to pay back of all of its debts.
The Debt to FCF ratio of ZS (2.34) is better than 66.67% of its industry peers.
A Debt/Equity ratio of 0.95 indicates that ZS is somewhat dependend on debt financing.
The Debt to Equity ratio of ZS (0.95) is worse than 72.98% of its industry peers.
Even though the debt/equity ratio score it not favorable for ZS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 2.34 | ||
| Altman-Z | 6.84 |
ROIC/WACCN/A
WACC10.85%
2.3 Liquidity
ZS has a Current Ratio of 2.01. This indicates that ZS is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.01, ZS is in the better half of the industry, outperforming 61.40% of the companies in the same industry.
ZS has a Quick Ratio of 2.01. This indicates that ZS is financially healthy and has no problem in meeting its short term obligations.
ZS has a Quick ratio of 2.01. This is in the better half of the industry: ZS outperforms 62.46% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.01 | ||
| Quick Ratio | 2.01 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.82% over the past year.
ZS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 68.71% yearly.
The Revenue has grown by 23.31% in the past year. This is a very strong growth!
ZS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 44.03% yearly.
EPS 1Y (TTM)2.82%
EPS 3Y68.14%
EPS 5Y68.71%
EPS Q2Q%1.14%
Revenue 1Y (TTM)23.31%
Revenue growth 3Y34.82%
Revenue growth 5Y44.03%
Sales Q2Q%21.31%
3.2 Future
Based on estimates for the next years, ZS will show a very strong growth in Earnings Per Share. The EPS will grow by 21.82% on average per year.
Based on estimates for the next years, ZS will show a quite strong growth in Revenue. The Revenue will grow by 19.88% on average per year.
EPS Next Y15.56%
EPS Next 2Y17.93%
EPS Next 3Y19.82%
EPS Next 5Y21.82%
Revenue Next Year23.29%
Revenue Next 2Y21.51%
Revenue Next 3Y20.8%
Revenue Next 5Y19.88%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
ZS is valuated quite expensively with a Price/Earnings ratio of 94.63.
ZS's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 27.77. ZS is valued rather expensively when compared to this.
A Price/Forward Earnings ratio of 81.88 indicates a quite expensive valuation of ZS.
ZS's Price/Forward Earnings is on the same level as the industry average.
ZS is valuated expensively when we compare the Price/Forward Earnings ratio to 23.23, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 94.63 | ||
| Fwd PE | 81.88 |
4.2 Price Multiples
The rest of the industry has a similar Price/Free Cash Flow ratio as ZS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 67.61 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ZS's earnings are expected to grow with 19.82% in the coming years. This may justify a more expensive valuation.
PEG (NY)6.08
PEG (5Y)1.38
EPS Next 2Y17.93%
EPS Next 3Y19.82%
5. Dividend
5.1 Amount
ZS does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
310.37
+4.47 (+1.46%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners56.62%
Inst Owner Change-0.22%
Ins Owners35.96%
Ins Owner Change2.51%
Market Cap49.13B
Analysts80.71
Price Target332.23 (7.04%)
Short Float %5.88%
Short Ratio3.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.32%
Min EPS beat(2)8.25%
Max EPS beat(2)8.39%
EPS beat(4)4
Avg EPS beat(4)11.04%
Min EPS beat(4)8.25%
Max EPS beat(4)18.11%
EPS beat(8)8
Avg EPS beat(8)19.74%
EPS beat(12)12
Avg EPS beat(12)18.67%
EPS beat(16)16
Avg EPS beat(16)20.39%
Revenue beat(2)0
Avg Revenue beat(2)-1.22%
Min Revenue beat(2)-1.22%
Max Revenue beat(2)-1.21%
Revenue beat(4)1
Avg Revenue beat(4)-0.72%
Min Revenue beat(4)-1.22%
Max Revenue beat(4)0.57%
Revenue beat(8)5
Avg Revenue beat(8)0.13%
Revenue beat(12)8
Avg Revenue beat(12)0.42%
Revenue beat(16)12
Avg Revenue beat(16)1.18%
PT rev (1m)0%
PT rev (3m)4.87%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.31%
EPS NY rev (1m)0%
EPS NY rev (3m)0.47%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)3.03%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 94.63 | ||
| Fwd PE | 81.88 | ||
| P/S | 18.38 | ||
| P/FCF | 67.61 | ||
| P/OCF | 50.52 | ||
| P/B | 27.31 | ||
| P/tB | 36.82 | ||
| EV/EBITDA | N/A |
EPS(TTM)3.28
EY1.06%
EPS(NY)3.79
Fwd EY1.22%
FCF(TTM)4.59
FCFY1.48%
OCF(TTM)6.14
OCFY1.98%
SpS16.89
BVpS11.37
TBVpS8.43
PEG (NY)6.08
PEG (5Y)1.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.65% | ||
| ROE | -2.31% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 76.87% | ||
| FCFM | 27.19% |
ROA(3y)-2.49%
ROA(5y)-6.57%
ROE(3y)-11.58%
ROE(5y)-30.47%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.4%
GM growth 5Y-0.23%
F-Score4
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 2.34 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | 202.8% | ||
| Cap/Sales | 9.19% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.01 | ||
| Quick Ratio | 2.01 | ||
| Altman-Z | 6.84 |
F-Score4
WACC10.85%
ROIC/WACCN/A
Cap/Depr(3y)212%
Cap/Depr(5y)195.75%
Cap/Sales(3y)8.71%
Cap/Sales(5y)8.62%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)2.82%
EPS 3Y68.14%
EPS 5Y68.71%
EPS Q2Q%1.14%
EPS Next Y15.56%
EPS Next 2Y17.93%
EPS Next 3Y19.82%
EPS Next 5Y21.82%
Revenue 1Y (TTM)23.31%
Revenue growth 3Y34.82%
Revenue growth 5Y44.03%
Sales Q2Q%21.31%
Revenue Next Year23.29%
Revenue Next 2Y21.51%
Revenue Next 3Y20.8%
Revenue Next 5Y19.88%
EBIT growth 1Y-0.61%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year55.15%
EBIT Next 3Y33.84%
EBIT Next 5YN/A
FCF growth 1Y24.23%
FCF growth 3Y46.46%
FCF growth 5Y92.49%
OCF growth 1Y24.7%
OCF growth 3Y44.56%
OCF growth 5Y65.09%