$$ZS ZScaler is awesome

As I have mentioned a few times, buy IT division was spun off to a standalone company and had the opportunity to start from scratch and therefore pick all new tools. We now use:
ServiceNow - help test, change requests
UltiPro - Paycheck, HR stuff
Concurr (SAP) - travel expenses
Office 365
Integrify - Purchase Request and orders, receive etc.
OKTA - single sign-on access to all the tools

And Zscaler - secure remote acces.
So ZScalser is awesome. In the past if I wanted to take my laptop home and work from home, it was a complicated and slow process to open the VPN, login, get it going and access Email and files on a shared drive.

Now that we are using Zscaler, it is 100% transparent. I just turn on my laptop and everything is there. And access to files is much faster. It is truly game changing. It is like cell phones to rotary dial phones.

I recently purchased a starter position on a chart break out (based on my love of the tool) - and still in buy range. I am pretty sure I will be adding more soon. I highly recommend researching this stock.

There have been a couple earlier posts on this board that I have seen. One talked about the Gov accepting it as a way to do remote work. First, my Gov customers are encouraged to remotely work and a tool like this would really help. Second, the Gov is slowly, but finally moving to the cloud and this is a component of that.

It is a young company and recent IP, Sales growing well, but earnings not good yet…
Sales % Chg (Last Qtr) 49%
3 Yr Sales Growth Rate 55%

Composite Rating 76 Fail
EPS Rating 31 Fail
RS Rating 95 Pass
Group RS Rating A Pass
SMR Rating D Fail
Acc/Dis Rating B+ Pass


Earnings 8/29



Watch the videos. Start out with GE’s CIO who admitted he was the only one there with nothing to sell to any one there. What Zs uniquely enables (and uniquely means the only company in the world with this capability, with no other company within years of them, and all of them, except Zs using appliances at each node, enables GE to get rid of the data center that no other method of security in the world that otherwise exists allows him to trust his network and to make the the Internet the GE network.

Also, look at forward looking revenues by an utterly disruptive company, with no other real competition, innovator’s dilemma w every other vendor, no one within years of them, that can utterly replace the WAN, and then get back to us.


May want to look here as well. This company is not just security, it is the key enabling technology that enables a company to get rid of the data center (at least as much as they want to) and turn the entire internet into their data center at less cost, less complexity, and a much higher degree of security. No one else on the planet can enable this to happen.

Review, and get back to me. The valuation, well…I will just put it into perspective. In Gartner, possibly unique to any market that I have ever looked at, there are only two companies in the leader quadrant for internet security. Those are BlueCoat and Zs. Zs is way ahead on both measurements in the quadrant.

Symantec bought BlueCoat about 2 years ago for $4.6 billion. Symantec put BlueCoat’s CEO as head of Symantec. BlueCoat is probably the most heavily reliant appliance company in the world, even though their appliances work very well. No other companies were even close, with Cisco being in the leader position in the upper left quadrant without a dozen others.

Bluecoat is growing…not so much. In fact Symantec Billings just fell 20% in enterprise, while Zs’s billing, Kingran aside, just grew 70% YoY. Despite a rapidly growing market someone is not only losing share but decreasing in total revenues and someone is eating up the nascent market with a steam shovel.

If you can let me know who else is eating up BlueCoat’s otherwise market leading numbers let me know.

Yes valuation, I hear yeah. Then again Zs is worth much more than BlueCoat. Could be that Symantec overpaid at 8.5x revenues for an appliance heavy market leading competitor that they can cross sell through. Zs is worth much more than that given he above, in my opinion.

Whether or not it is currently worth what it should be, I say yes, as a buy out would cost more than this. Whether they are worth significantly more than this 2 years from now, that depends on whether or not 70% billings growth type numbers continue.




Earnings 8/29

ZS investor relations web site says:

SAN JOSE, Calif., Aug. 08, 2018 (GLOBE NEWSWIRE) – Zscaler, Inc. (NASDAQ: ZS), the leader in cloud security, will release fiscal fourth quarter and fiscal year 2018 earnings after the market closes on Wednesday, September 5.