Cybersecurity Sector Ideas

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>>> Zscaler - >>> 2 Monster Growth Stocks To Buy and Hold Right Now


Motley Fool

By Trevor Jennewine

Dec 10, 2021


https://www.fool.com/investing/2021/12/10/2-monster-growth-stocks-to-buy-and-hold-right-now/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article


Zscaler is a pioneer in cloud security. Its platform, called a secure access service edge (SASE), is designed to replace traditional corporate networks. Rather than routing web traffic through a central hub, clients lean on Zscaler's network of over 150 global data centers to enforce security policies, which makes it possible to quickly and safely access corporate resources from any device or location.

Specifically, Zscaler's portfolio includes four products: Zscaler Internet Access and Zscaler Public Access, which allow clients to safely connect to both external and internal applications; and Zscaler Cloud Protection and Zscaler Digital Experience, which secure cloud workloads and help IT teams monitor the performance of networks, applications, and infrastructure.

Broadly speaking, by accelerating and securing corporate resources, Zscaler helps businesses provide employees with a high-quality user experience, whether they are in the office or working remotely. And because Zscaler delivers those services from the cloud, clients avoid the cost and commitment of managing the underlying hardware.

That value proposition is only becoming more compelling, as evidenced by Zscaler's strong financial performance over the past year.

Metric

Q1 2021 (TTM)

Q1 2022 (TTM)

Change

Revenue

$480.3 million

$761.0 million

58%

Free cash flow

$60.3 million

$184.9 million

207%

Source: YCharts. TTM = trailing-12-months. Note: Q1 2022 ended Oct. 31, 2021.

Going forward, Zscaler has a good shot at maintaining that momentum. The company puts its addressable market at $72 billion, and the founder-led management team has already demonstrated its ability to expand the platform and grow the business. Moreover, 92% of employees would recommend the company to a friend, and 98% approve of the founder and CEO Jay Chaudhry, according to Glassdoor. Those impressive statistics suggest a strong corporate culture.

It's noteworthy that Gartner has recognized Zscaler as the industry leader for the last 10 consecutive years, evidencing the company's strong competitive position. Gartner also projects that 60% of organizations will have plans in place to adopt SASE networks by 2025, up from 10% in 2020. That tailwind should be a significant growth driver for Zscaler. That's why this stock belongs in your portfolio.

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