ZScaler, Our Top Pick In Cybersecurity
In-network, high growth, high margin, fat order book, what's not to like?
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Number Go Up, Number Go Down
by Alex King and
ZS stock has been on fire lately, from a 2023 low in the $90 range to a high before and after earnings in the $190-200 range. Welcome to high beta software stocks - not for the faint of heart!
The earnings print was rock solid; the fly in the ointment is a tiny reduction in the size of the order book ('remaining performance obligation' or RPO) since last quarter. Most likely that is a seasonal thing - the ZS CEO has been around the block a couple times and there is still plenty about ZS that looks like the old-line Oracle sales model, not least its heroic quarterly sales behavior. Under such a sales model - and more importantly comp model - Q4 is when heroes and villains are made, not Q1. Huge Q4, Q1 sucking wind, situation normal in the Land Of Larry.
For our Premium and Pro members here at Cestrian Tech Select, we walk you through the numbers, operating insights, valuation and stock chart outlook. Read on!