Zscaler vs Cisco Systems

Zscaler and Cisco Systems are two prominent players in the cybersecurity sector, with both companies offering innovative solutions to protect organizations from cyber threats. While Zscaler specializes in cloud-based security solutions, Cisco Systems offers a wide range of security products and services. Investors looking to capitalize on the growing demand for cybersecurity services may consider investing in either Zscaler or Cisco Systems stocks. To make an informed decision, one must analyze the financial performance, market position, and growth potential of both companies.

Zscaler or Cisco Systems?

When comparing Zscaler and Cisco Systems, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Zscaler and Cisco Systems.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Zscaler has a dividend yield of -%, while Cisco Systems has a dividend yield of 2.94%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Zscaler reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Cisco Systems reports a 5-year dividend growth of 3.90% year and a payout ratio of 61.86%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Zscaler P/E ratio at -512.36 and Cisco Systems's P/E ratio at 21.06. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Zscaler P/B ratio is 23.21 while Cisco Systems's P/B ratio is 4.78.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Zscaler has seen a 5-year revenue growth of 2.75%, while Cisco Systems's is 0.37%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Zscaler's ROE at -5.58% and Cisco Systems's ROE at 22.60%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $194.27 for Zscaler and $53.92 for Cisco Systems. Over the past year, Zscaler's prices ranged from $152.60 to $259.61, with a yearly change of 70.12%. Cisco Systems's prices fluctuated between $44.50 and $54.61, with a yearly change of 22.71%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.