And how about this?

Also an important press release today, which should be of major significance for the company. Greatly shortened and paraphrased by me. bolding is mostly mine. Is no one else following the actual important news about our companies?

"Zscaler Private Access achieves DoD Impact Level 5

Empowers DoD to reduce cyber risk, adopt modern cloud solutions, and implement DISA’s new Zero Trust reference architecture.

Dept of Defense has granted Zscaler Private Access a Provisional Authorization to operate at Impact Level 5. Government agencies and their contractors will be able to use Zscaler’s Zero Trust platform for systems that manage their most sensitive Controlled Unclassified Information (CUI) as well as unclassified National Security Systems (NSSs).

ZPA is a zero trust network access service that connects trusted users directly to trusted cloud applications. Organizations can dramatically reduce cyber risk and adopt modern cloud solutions."


Positive News:
Zscaler is actively being discussed as a good solution for Zero Trust strategies within government agencies today as a proven solution - with some challenges. It has some very nice word of mouth advertising.

Negative News:
Analysts are very bearish about ZS. Fidelity’s Equity Summary Score for ZS is 0.8 with one firm recommending folks sell out of ZS.

Bottom Line:
One to watch. I’m too nervous to invest at the moment. It has performed well historically. Will that continue? Zacks expects it to underperform the market over the next several months.

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Analysts are very bearish about ZS. Fidelity’s Equity Summary Score for ZS is 0.8 with one firm recommending folks sell out of ZS.

Garver, please don’t litter our board with such total nonsense. If you want to pay attention to your Broker and an analyst opinion, you should just stay off our board. Even in years when my portfolio was rising 70% to 200% my broker, Schwab, rated my stocks all C, D, or F (they have no E rating), with maybe a rare B.

Right now six of my stocks are rated, two C’s, two D’s and two F’s! My 1,2,and 3 positions are rated F, D, and D. (That’s Upstart, Datadog, and Cloudflare! Ooooh! Maybe I should sell them all?)

That’s the way they’ve been rated all along. Let’s see, at the end of last month they were up 249%, 70% and 156%n so far this year. Clearly under-performers. I shouldn’t have them in my portfolio.

You come to a board with some of the best performing investors in the market and you want us to be scared because of a broker’s recommendation and an analyst’s sell recommendation. You must be kidding! If you are a short seller trying to scare us, you are not very good at it.



To follow-up on Saul’s comment about brokerage ratings…

25% of my holdings are “C” rated
17% of my holdings are “D” rated
38% of my holdings are “F” rated
9% of my holdings are unrated

Many years ago this anomaly concerned me.

Unless your investing objective is to match the SP-500, I would ignore brokerage ratings/recommendations.

post tenebras lux
For not in my bow do I trust, nor can my sword save me.


garverc - please read Saul’s Knowledgebase Part 1 (…) regarding Estimates and Analysts. While I’ve copied it below, it does not keep Saul’s highlighting so better to read the Knowledgebase. Along with the entire Knowledgebase, it is brilliant. Coincidentally, I was just re-reading this today before I saw this thread. Thanks again Saul.

On the Estimates Game. I exaggerate a little for the clarity of the message, but what I am saying is essentially all true. I hope you find these ideas useful:

The earnings and revenues estimate game that the analysts play has put the company CFO’s, who give the outlooks, in a no-win situation. Here’s how it has come to work over time: It doesn’t seem to make any difference how good or bad the actual results are, whether they are up 3%, or 30%, or 70%, or more. The only thing that the headlines pick up is whether the earnings beat or missed analysts’ estimates. (Who cares???)

For example, a company whose earnings are up just 3%, but beats estimates by a nickel, will get screaming headlines. The headlines won’t say “ABC earnings only up 3%!” No, the headlines will say “ABC beats estimates!” The price will undoubtedly rise.

On the other hand, a company whose earnings are up 70%, but misses estimates by three cents, will get equally screaming headlines, not saying “DEF earnings up an amazing 70%”, but saying “DEF misses estimates!!!” The price will undoubtedly fall.

The whole estimates game is only about whether the earnings and revenue beat or miss a number that some analysts have picked. It totally ignores the question of how well the company is actually doing, and how good (or bad) the revenues and earnings really are.

However, the companies aren’t stupid. They have figured this out. And they have started to give lower and lower estimates for their next quarter, picking numbers that they are almost certain to beat (by a lot). They don’t want the bad publicity of missing analyst estimates. (Again, who cares!!!)

So what happens? The companies give low estimates and the analysts say “Good earnings, but disappointing estimates for the next quarter. We’re downgrading them from a buy to a hold.”

Thus the companies are screwed whatever they do. If they estimate high, where they think they will be, and miss, they get the “missed estimates” headlines, and if they estimate low, to let themselves beat estimates handily, they get the “disappointing estimates” headline. They lose either way.

How do we as investors deal with this puzzle? Think “How is this company doing? How much are earnings and revenues actually up?” What matters to me is that the company is growing revenue at 50%, and if the company sells off because of a “revenue miss” (which is a ridiculous term for a company increasing revenue by 50% if you think about it), I might take advantage of it by adding to my position.

I base my purchase decisions on how well the company is doing, and my evaluation of how it will do in the future, and how well its price matches its prospects, rather than whether the company came in two cents above, or two cents below, what the analysts predicted.

Evaluating company results against consensus analyst estimates can produce perverse and peculiar results. Consider this hypothetical: A small stock with three analysts following it has an average estimate of 50 cents for the quarter. Another “analyst” representing a firm that is secretly short the stock, puts in an estimate of 82 cents. This raises the “average estimate” to 58 cents. By raising the estimate he sets the company up to “miss” estimates. After all, it doesn’t matter what the actual results are, just whether they met expectations. Right???

Sure enough, if the company makes 53 cents, what would have been a nice beat becomes a 5 cent miss. The stock sells off for a few days, until people figure out that 53 cents was a very good result, and meanwhile, the firm closes out its short at a profit. Pretty ridiculous, isn’t it. But this hypothetical scenario could, and probably does, play out in the current market.


25% of my holdings are “C” rated
17% of my holdings are “D” rated
38% of my holdings are “F” rated
9% of my holdings are unrated

Seems like a reliable contrarian indicator to me :o)