Financial Review: Zscaler (NASDAQ:ZS) & X3 (NASDAQ:XTKG)

X3 (NASDAQ:XTKG) and Zscaler (NASDAQ:ZS) are both business services companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, risk, profitability, institutional ownership, valuation and analyst recommendations.

Valuation and Earnings

This table compares X3 and Zscaler’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
X3	$16.82 million	0.03	-$109.60 million	N/A	N/A
Zscaler	$1.62 billion	15.49	-$202.34 million	($0.51)	-325.00

X3 has higher earnings, but lower revenue than Zscaler.

Institutional & Insider Ownership

1.9% of X3 shares are owned by institutional investors. Comparatively, 46.5% of Zscaler shares are owned by institutional investors. 23.9% of X3 shares are owned by company insiders. Comparatively, 19.2% of Zscaler shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

X3 has a beta of 1.52, indicating that its share price is 52% more volatile than the S&P 500. Comparatively, Zscaler has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for X3 and Zscaler, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
X3	0	0	0	0	N/A
Zscaler	0	8	26	1	2.80

Zscaler has a consensus target price of $225.21, suggesting a potential upside of 35.87%. Given Zscaler’s higher probable upside, analysts clearly believe Zscaler is more favorable than X3.

Profitability

This table compares X3 and Zscaler’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
X3	N/A	N/A	N/A
Zscaler	-3.62%	-5.84%	-1.36%

About X3

X3 Holdings Co Ltd. provides technology solutions and services worldwide. The company offers Global Trade Platform, a digital platform for trading partners, service providers, and government authorities. It also engages in bitcoin cryptomining operations, renewable energy projects, and agriculture technologies and trading. The company was formerly known as Powerbridge Technologies Co., Ltd. and changed its name to X3 Holdings Co Ltd. in January 2024. X3 Holdings Co Ltd. was founded in 1997 and is headquartered in Singapore.

About Zscaler

Zscaler, Inc. operates as a cloud security company worldwide. The company offers Zscaler Internet Access solution that provides users, workloads, IoT, and OT devices secure access to externally managed applications, including software-as-a-service (SaaS) applications and internet destinations; and Zscaler Private Access solution, which is designed to provide access to managed applications hosted internally in data centers, and private or public clouds. It also provides Zscaler Digital Experience that measures end-to-end user experience across business applications, as well as provides an easy-to-understand digital experience score for each user, application, and location within an enterprise. In addition, the company offers Posture Control solutions comprising Cloud Security Posture Management that identifies and remediates application misconfigurations in SaaS, infrastructure as a service, and PaaS to reduce risk and ensure compliance with industry and organizational benchmarks; Cloud Infrastructure Entitlement Management that detects and remediates excessive or unused cloud permissions and enforces least privileged access without disrupting productivity; Infrastructure as Code (IaC), which analyzes IaC templates to identify misconfigurations and other security issues prior to deployment to cloud infrastructure; and Vulnerability Scanning and Data Loss Prevention solutions. Its platform modules include Zscaler Central Authority, Zscaler Enforcement Node, and Zscaler Log Servers. The company serves customers in airlines and transportation, conglomerates, consumer goods and retail, financial services, healthcare, manufacturing, media and communications, public sector and education, technology, and telecommunications services industries. The company was formerly known as SafeChannel, Inc., and changed its name to Zscaler, Inc. in August 2008. Zscaler, Inc. was incorporated in 2007 and is headquartered in San Jose, California.