Zscaler (NASDAQ:ZS) Sees Strong Trading Volume After Analyst Upgrade

Zscaler, Inc. (NASDAQ:ZS) shares saw unusually-high trading volume on Thursday after Zacks Research upgraded the stock from a strong sell rating to a hold rating. Approximately 2,370,446 shares changed hands during mid-day trading, a decline of 26% from the previous session’s volume of 3,184,495 shares.The stock last traded at $123.5680 and had previously closed at $126.41.

ZS has been the subject of several other reports. BMO Capital Markets dropped their target price on shares of Zscaler from $210.00 to $178.00 and set an “outperform” rating for the company in a report on Wednesday. The Goldman Sachs Group reaffirmed a “neutral” rating and issued a $179.00 price target on shares of Zscaler in a report on Wednesday. Oppenheimer cut their price objective on Zscaler from $280.00 to $250.00 and set an “outperform” rating for the company in a research report on Tuesday, March 10th. B. Riley Financial reduced their target price on Zscaler from $225.00 to $215.00 and set a “buy” rating on the stock in a research note on Wednesday. Finally, Berenberg Bank set a $200.00 target price on Zscaler in a report on Thursday. Thirty-two equities research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $216.08.

Insider Buying and Selling

In related news, insider Adam Geller sold 2,094 shares of the stock in a transaction on Wednesday, March 18th. The stock was sold at an average price of $153.53, for a total value of $321,491.82. Following the transaction, the insider directly owned 46,949 shares of the company’s stock, valued at approximately $7,208,079.97. This trade represents a 4.27% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CFO Kevin Rubin sold 1,682 shares of the business’s stock in a transaction dated Tuesday, March 17th. The shares were sold at an average price of $156.59, for a total value of $263,384.38. Following the sale, the chief financial officer directly owned 46,479 shares of the company’s stock, valued at approximately $7,278,146.61. This trade represents a 3.49% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 12,130 shares of company stock worth $1,892,487 over the last 90 days. Company insiders own 17.20% of the company’s stock.

Zscaler News Summary

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Despite the selloff, Zscaler reported strong fiscal Q3 results with revenue growth of about 25% year over year and earnings that beat estimates, which some analysts say supports the long-term cybersecurity demand story.
• Positive Sentiment: Some commentary argues the market may be overreacting to the guidance cut, pointing to Zscaler’s strong net retention and its role in AI-driven security workflows as reasons the stock could eventually recover. MarketBeat Zscaler page
• Neutral Sentiment: Zacks Research upgraded Zscaler from “strong sell” to “hold,” suggesting the recent drop may have improved the risk/reward profile, but it does not signal a clear bullish turn.
• Neutral Sentiment: Several articles discuss broader cybersecurity weakness tied to Google’s AI security platform launch and changing investor sentiment around software, which adds context but is not Zscaler-specific.
• Negative Sentiment: Wall Street’s main concern is the disappointing forward guidance, which overshadowed the earnings beat and raised questions about near-term growth and sales execution.
• Negative Sentiment: Reports of class-action and securities-fraud investigations may add overhang to the stock until management can rebuild confidence. Investor alert article

Hedge Funds Weigh In On Zscaler

Several hedge funds and other institutional investors have recently made changes to their positions in the business. Binnacle Investments Inc acquired a new position in shares of Zscaler during the third quarter worth about $25,000. Picton Mahoney Asset Management acquired a new position in Zscaler during the 3rd quarter worth approximately $30,000. AlphaCentric Advisors LLC acquired a new position in Zscaler during the 4th quarter worth approximately $29,000. University of Texas Texas AM Investment Management Co. purchased a new stake in shares of Zscaler during the fourth quarter valued at approximately $30,000. Finally, Mcguire Capital Advisors Inc. acquired a new position in shares of Zscaler during the fourth quarter worth $32,000. Institutional investors and hedge funds own 46.45% of the company’s stock.

Zscaler Trading Up 7.5%

The firm has a market capitalization of $22.60 billion, a price-to-earnings ratio of -291.10 and a beta of 0.96. The business’s 50-day moving average price is $144.36 and its 200 day moving average price is $189.61. The company has a debt-to-equity ratio of 0.72, a current ratio of 1.86 and a quick ratio of 1.90.

Zscaler (NASDAQ:ZS) last posted its quarterly earnings data on Tuesday, May 26th. The company reported $1.08 earnings per share for the quarter, beating analysts’ consensus estimates of $1.01 by $0.07. Zscaler had a negative net margin of 2.44% and a negative return on equity of 0.37%. The company had revenue of $850.48 million during the quarter, compared to analysts’ expectations of $835.14 million. During the same period in the prior year, the company posted $0.84 EPS. The firm’s revenue for the quarter was up 25.4% on a year-over-year basis. Zscaler has set its Q4 2026 guidance at 1.080-1.090 EPS and its FY 2026 guidance at 4.100-4.110 EPS. On average, equities analysts forecast that Zscaler, Inc. will post -0.03 earnings per share for the current fiscal year.

About Zscaler

Zscaler is a cloud security company that delivers a cloud-native platform to protect users, applications and data as organizations move away from traditional, network-centric security architectures. The company focuses on a zero trust approach that assumes no implicit trust for users or devices, providing secure access to the internet, SaaS applications and private applications regardless of where users are located. Zscaler positions its services as an alternative to legacy appliances and site-centric VPNs, aiming to simplify security while enabling modern, distributed workforces.

Key offerings are built around the Zscaler Zero Trust Exchange, a multi-tenant cloud platform that enforces security and access policies in-line.