ZSCALER INC (ZS) Stock Fundamental Analysis
USA - NASDAQ:ZS - US98980G1022 - Common Stock
326.33 USD
+3.33 (+1.03%)
326.98 USD
+0.65 (+0.2%)
Taking everything into account, ZS scores 4 out of 10 in our fundamental rating. ZS was compared to 285 industry peers in the Software industry. ZS scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. 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's Return On Assets of -0.65% is in line compared to the rest of the industry. ZS outperforms 57.54% of its industry peers.
ZS has a Return On Equity (-2.31%) which is comparable to the rest of the industry.
| 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 Gross Margin of 76.87%. This is in the better half of the industry: ZS outperforms 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.
ZS has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ZS has more shares outstanding
The debt/assets ratio for ZS is higher compared to a year ago.
2.2 Solvency
ZS has an Altman-Z score of 7.19. This indicates that ZS is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.19, ZS is in the better half of the industry, outperforming 75.44% of the companies in the same industry.
The Debt to FCF ratio of ZS is 2.34, which is a good value as it means it would take ZS, 2.34 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.34, ZS is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
A Debt/Equity ratio of 0.95 indicates that ZS is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.95, ZS is doing worse than 72.98% of the companies in the same industry.
Although ZS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 2.34 | ||
| Altman-Z | 7.19 |
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.
A Quick Ratio of 2.01 indicates that ZS has no problem at all paying its short term obligations.
The Quick ratio of ZS (2.01) is better than 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.
ZS shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.31%.
Measured over the past years, ZS shows a very strong growth in Revenue. The Revenue has been growing by 44.03% on average per year.
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
The Earnings Per Share is expected to grow by 21.82% on average over the next years. This is a very strong growth
ZS is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 19.88% yearly.
EPS Next Y15.56%
EPS Next 2Y17.93%
EPS Next 3Y19.43%
EPS Next 5Y21.82%
Revenue Next Year23.29%
Revenue Next 2Y21.27%
Revenue Next 3Y20.77%
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 99.49.
The rest of the industry has a similar Price/Earnings ratio as ZS.
The average S&P500 Price/Earnings ratio is at 27.08. ZS is valued rather expensively when compared to this.
The Price/Forward Earnings ratio is 86.09, which means the current valuation is very expensive for 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 23.09, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 99.49 | ||
| Fwd PE | 86.09 |
4.2 Price Multiples
ZS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 71.09 | ||
| 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.
A more expensive valuation may be justified as ZS's earnings are expected to grow with 19.43% in the coming years.
PEG (NY)6.39
PEG (5Y)1.45
EPS Next 2Y17.93%
EPS Next 3Y19.43%
5. Dividend
5.1 Amount
No dividends for ZS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
326.33
+3.33 (+1.03%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners56.62%
Inst Owner Change-0.12%
Ins Owners35.96%
Ins Owner Change2.4%
Market Cap51.66B
Revenue(TTM)2.67B
Net Income(TTM)-41478000
Analysts80.71
Price Target332.23 (1.81%)
Short Float %5.31%
Short Ratio3.59
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)2.85%
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 | 99.49 | ||
| Fwd PE | 86.09 | ||
| P/S | 19.33 | ||
| P/FCF | 71.09 | ||
| P/OCF | 53.12 | ||
| P/B | 28.71 | ||
| P/tB | 38.72 | ||
| EV/EBITDA | N/A |
EPS(TTM)3.28
EY1.01%
EPS(NY)3.79
Fwd EY1.16%
FCF(TTM)4.59
FCFY1.41%
OCF(TTM)6.14
OCFY1.88%
SpS16.89
BVpS11.37
TBVpS8.43
PEG (NY)6.39
PEG (5Y)1.45
Graham Number28.96
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
ROICexgc growth 3YN/A
ROICexgc 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 | 7.19 |
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 3Y19.43%
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 2Y21.27%
Revenue Next 3Y20.77%
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%
ZSCALER INC / ZS FAQ
Can you provide the ChartMill fundamental rating for ZSCALER INC?
ChartMill assigns a fundamental rating of 4 / 10 to ZS.
What is the valuation status for ZS stock?
ChartMill assigns a valuation rating of 1 / 10 to ZSCALER INC (ZS). This can be considered as Overvalued.
How profitable is ZSCALER INC (ZS) stock?
ZSCALER INC (ZS) has a profitability rating of 3 / 10.
What is the valuation of ZSCALER INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for ZSCALER INC (ZS) is 99.49 and the Price/Book (PB) ratio is 28.71.
How financially healthy is ZSCALER INC?
The financial health rating of ZSCALER INC (ZS) is 6 / 10.