No. of Recommendations: 2
Looking at yahoo! analyst estimates, the high estimate for Zscaler has now materially increased to $281 million for the year. Getting closer and closer to my $285 prediction. MDB has increased their estimates for this year well above the $235 I had penned in.

This price to sale is arbitrary as long as the fundamentals continue. for 2020 analyst have Zscaler plugged in for only 29% growth. If that happens, then yes the prices to sale will come down, but at a higher revenue number. It may be a wash in the end.

For MDB analysts have 41% growth for 2020, so higher expectations.

From these low revenue numbers there is no reason either company cannot beat current estimates. But of course a lot depends on what is going on in the world. But their price to sales numbers are not a bubble, they are not arbitrary, and the number will not disappear as a matter of course. It will only change with a change in fundamentals. Even then, like with Nvidia, the price to sale ratio will probably stay around the same, it is just the projected revenues that will decline (e.g. Nvidia).

Tinker
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