Growth investing holds the promise of attractive capital gains as companies increase their revenue and net profits.
When searching for suitable growth stocks, it’s useful to go through a list of questions on whether the growth will be sustainable.
One method of filtering out good growth stocks is to see if the business is latching on to tailwinds that can stretch over years or even decades.
These tailwinds provide the company with ample growth opportunities by increasing its total addressable market (TAM) and allowing it to scale to capture more customers.
And as customers increase their spending over time, these stocks will also benefit as they report higher revenue, profits and cash flow.
Zscaler (NASDAQ: ZS)
Founded in 2007, Zscaler is a leader in cybersecurity and operates the world’s largest in-line security cloud platform.
The company has grown impressively over the years.
Revenue surged from US$190 million in fiscal 2018 (FY2018 ending 31 July) to US$1.1 billion in...