Zscaler (NASDAQ:ZS) Stock Price Up 5.7% – Still a Buy?

Shares of Zscaler, Inc. (NASDAQ:ZS) rose 5.7% on Wednesday. The stock traded as high as $228.00 and last traded at $226.6750. 434,072 shares traded hands during mid-day trading, a decline of 87% from the average session volume of 3,323,542 shares. The stock had previously closed at $214.51.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Freedom Broker raised its price target to $270 from $230 and maintained a Buy rating, implying additional upside from recent trading levels. The upgrade helped reinforce bullish sentiment across cybersecurity stocks. Freedom Broker raises Zscaler price target
• Positive Sentiment: Zscaler’s Data Security annual recurring revenue exceeded $500 million and grew more than 30% year over year. The company also reported a major seven-figure expansion with a global asset manager, suggesting that its data-protection tools are generating larger customer commitments. Nvidia AI security tie-up at Zscaler
• Positive Sentiment: Zscaler is positioning its Zero Trust platform for the growth of enterprise AI. Its integration with NVIDIA’s OpenShell architecture and participation in roughly 70% of Security for AI deals could help the company secure autonomous AI agents and sensitive data flows, potentially increasing deal sizes and cross-selling opportunities. Zscaler’s data security push
• Positive Sentiment: Broader cybersecurity sentiment improved as concerns about artificial-intelligence disruption eased and newly identified PHP security flaws increased demand for security-related stocks. Zscaler also benefited from investor confidence following an Investor Day that reaffirmed guidance and outlined a potential path to more than $8 billion in ARR by fiscal 2031. Zscaler and Tenable shares rise
• Neutral Sentiment: DA Davidson initiated coverage with a Neutral rating and a $215 price target, indicating valuation concerns despite the company’s growth outlook. DA Davidson coverage of Zscaler
• Negative Sentiment: Pomerantz LLP is investigating potential claims on behalf of Zscaler investors. Although no findings were reported, the legal inquiry creates a possible overhang for the stock. Pomerantz investor investigation

Analyst Upgrades and Downgrades

ZS has been the topic of a number of recent research reports. Stifel Nicolaus increased their price objective on Zscaler from $200.00 to $235.00 and gave the company a “buy” rating in a research report on Wednesday, October 7th. Robert W. Baird boosted their target price on Zscaler from $230.00 to $285.00 and gave the stock an “outperform” rating in a research report on Wednesday, October 7th. Yorkville Ives assumed coverage on Zscaler in a research report on Tuesday, October 6th. They set an “outperform” rating and a $250.00 target price for the company. Freedom Broker upped their price target on Zscaler from $230.00 to $270.00 and gave the company a “buy” rating in a research note on Thursday. Finally, DA Davidson initiated coverage on Zscaler in a report on Wednesday. They issued a “neutral” rating and a $215.00 price target on the stock. Thirty-seven investment analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and an average price target of $240.14.

Zscaler Stock Up 2.8%

The business’s fifty day simple moving average is $195.51 and its 200 day simple moving average is $162.58. The stock has a market cap of $38.77 billion, a price-to-earnings ratio of -609.64, a price-to-earnings-growth ratio of 22.23 and a beta of 0.94. The company has a current ratio of 1.70, a quick ratio of 1.70 and a debt-to-equity ratio of 0.65.

Zscaler (NASDAQ:ZS) last posted its quarterly earnings results on Thursday, September 3rd. The company reported $1.19 earnings per share for the quarter, beating analysts’ consensus estimates of $1.09 by $0.10. Zscaler had a positive return on equity of 1.23% and a negative net margin of 1.88%. The company had revenue of $898.19 million for the quarter, compared to the consensus estimate of $876.96 million. During the same quarter in the prior year, the business posted $0.89 EPS. The firm’s quarterly revenue was up 24.9% on a year-over-year basis. Zscaler has set its FY 2027 guidance at 4.860-4.900 EPS and its Q1 2027 guidance at 1.150-1.160 EPS. Equities analysts forecast that Zscaler, Inc. will post 0.69 earnings per share for the current fiscal year.

Insider Buying and Selling

In other news, insider Adam Geller sold 23,958 shares of the company’s stock in a transaction dated Friday, October 9th. The stock was sold at an average price of $225.43, for a total value of $5,400,851.94. Following the completion of the sale, the insider directly owned 38,308 shares of the company’s stock, valued at $8,635,772.44. This represents a 38.48% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Kevin Rubin sold 5,957 shares of the stock in a transaction that occurred on Wednesday, September 16th. The shares were sold at an average price of $192.76, for a total transaction of $1,148,271.32. Following the completion of the sale, the chief financial officer owned 43,287 shares in the company, valued at $8,344,002.12. This represents a 12.10% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 54,053 shares of company stock worth $11,256,876 in the last ninety days. 17.20% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors have recently bought and sold shares of the company. Wedbush Securities Inc. raised its holdings in Zscaler by 14.3% in the third quarter. Wedbush Securities Inc. now owns 5,212 shares of the company’s stock worth $1,039,000 after purchasing an additional 652 shares during the period. Yousif Capital Management LLC bought a new position in shares of Zscaler during the third quarter worth $292,000. MLP3 LLC bought a new position in shares of Zscaler during the third quarter worth $212,000. MBL Wealth LLC acquired a new position in shares of Zscaler in the 3rd quarter valued at $919,000. Finally, Root Financial Partners LLC acquired a new position in shares of Zscaler in the 3rd quarter valued at $97,000. Institutional investors and hedge funds own 46.45% of the company’s stock.

About Zscaler

Zscaler, Inc is a cloud-based cybersecurity company that helps organizations secure access to applications, websites, data and other digital resources. Its platform is designed around a zero-trust security model, which verifies users and devices and enforces security policies before granting access, rather than relying primarily on a traditional corporate network perimeter.

The company’s offerings include Zscaler Internet Access, which provides secure access to internet and software-as-a-service applications, and Zscaler Private Access, which enables secure access to private applications without extending an organization’s network to users.