The Zhitong Finance App learned that Wedbush Securities analyst Dan Ives published a research report saying that Zscaler (ZS.US)'s latest quarterly results and guidelines were better than expected, which will make it a “top company worth owning” in the cybersecurity field. Ives maintained the stock's “overweight” rating and raised its price target from $250 to $260.
The analyst wrote in a report: “Previously, Zscaler reported results for the second fiscal quarter of 2024, and its revenue and profit were once again impressive as the company maintained strong momentum in the zero trust sector while maintaining an impressive profit margin discipline.”
Ives added, “Overall, we still believe that as cloud cybersecurity accelerates over the next decade, Zscaler is the top company in this space because it's been an impressive quarter.”
Strong results in the second quarter
According to financial reports, Zscaler's second-quarter adjusted earnings per share were 76 cents, and revenue increased 35.4% year over year to reach US$525 million, both higher than analysts' expectations of 58 cents and US$506.83 million.
Key revenue indicators cumulative orders increased 27% year over year to US$627.6 million, and deferred revenue increased 35% to US$1.5 billion.
Upgrading guidelines
Looking ahead, Zscaler raised its full-year guidance. The estimated revenue for the 2024 fiscal year is about $2,118 billion to $2,122 million, compared to the previous forecast of $2.09 billion to $2.11 billion, and the general forecast is $2.11 billion.
Cumulative orders for the full year are expected to increase from $2.52 billion to $2.56 billion to $2.56 billion to $2.57 billion. Adjusted earnings per share are currently projected at $2.73 to $2.77, previously forecasted at $2.45 to $2.48, and the prevailing forecast was $2.48.
For the third fiscal quarter, Zscaler expects adjusted earnings per share of 64 cents to 65 cents, with revenue of 534 million to $536 million; analysts expect earnings of 59 cents per share, with revenue of $5308.7 million.