Zscaler’s (ZS) Outperform Rating Reaffirmed at Wedbush

Zscaler (NASDAQ:ZS)‘s stock had its “outperform” rating reaffirmed by Wedbush in a report released on Wednesday,Benzinga reports. They presently have a $220.00 price target on the stock. Wedbush’s price objective would indicate a potential upside of 71.88% from the stock’s previous close.

A number of other brokerages have also issued reports on ZS. FBN Securities reiterated an “outperform” rating and set a $175.00 price target on shares of Zscaler in a research note on Wednesday, May 27th. Mizuho reduced their price objective on shares of Zscaler from $210.00 to $185.00 and set an “outperform” rating for the company in a research report on Wednesday, May 27th. Sanford C. Bernstein lowered their price objective on Zscaler from $228.00 to $224.00 and set an “outperform” rating on the stock in a report on Wednesday, May 27th. Guggenheim reiterated a “buy” rating and set a $214.00 target price on shares of Zscaler in a research report on Wednesday. Finally, Berenberg Bank set a $200.00 target price on Zscaler in a research note on Thursday, May 28th. Thirty-three analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and an average price target of $216.03.

Zscaler Stock Performance

Shares of NASDAQ ZS traded up $2.16 during mid-day trading on Wednesday, hitting $128.00. 666,730 shares of the company were exchanged, compared to its average volume of 3,569,907. The stock has a 50 day simple moving average of $143.22 and a 200-day simple moving average of $180.32. Zscaler has a 1-year low of $114.63 and a 1-year high of $336.99. The company has a quick ratio of 1.86, a current ratio of 1.86 and a debt-to-equity ratio of 0.72. The firm has a market cap of $20.70 billion, a price-to-earnings ratio of -266.18, a price-to-earnings-growth ratio of 80.81 and a beta of 0.97.

Zscaler (NASDAQ:ZS) last announced its quarterly earnings data on Tuesday, May 26th. The company reported $1.08 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.01 by $0.07. The company had revenue of $850.48 million for the quarter, compared to analysts’ expectations of $835.14 million. Zscaler had a negative net margin of 2.44% and a negative return on equity of 0.37%. Zscaler’s revenue was up 25.4% compared to the same quarter last year. During the same period in the previous year, the company posted $0.84 EPS. 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, sell-side analysts forecast that Zscaler will post 0.11 EPS for the current fiscal year.

Insider Activity

In other news, Director James A. Beer sold 177 shares of Zscaler stock in a transaction that occurred on Wednesday, March 18th. The shares were sold at an average price of $153.53, for a total transaction of $27,174.81. Following the completion of the sale, the director directly owned 4,384 shares in the company, valued at approximately $673,075.52. This trade represents a 3.88% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CFO Kevin Rubin sold 1,682 shares of the business’s stock in a transaction that occurred on Tuesday, March 17th. The stock was 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 in the company, valued at $7,278,146.61. This trade represents a 3.49% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 12,130 shares of company stock valued at $1,892,487 in the last quarter. Insiders own 17.20% of the company’s stock.

Hedge Funds Weigh In On Zscaler

Hedge funds and other institutional investors have recently bought and sold shares of the company. Binnacle Investments Inc purchased a new stake in Zscaler during the third quarter worth $25,000. AlphaCentric Advisors LLC purchased a new position in shares of Zscaler in the fourth quarter valued at $29,000. Picton Mahoney Asset Management purchased a new position in shares of Zscaler in the third quarter valued at $30,000. University of Texas Texas AM Investment Management Co. acquired a new position in shares of Zscaler during the 4th quarter worth $30,000. Finally, Mcguire Capital Advisors Inc. acquired a new position in shares of Zscaler during the 4th quarter worth $32,000. 46.45% of the stock is owned by institutional investors and hedge funds.

Key Headlines Impacting Zscaler

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Rosenblatt Securities reaffirmed its Buy rating and set a $200 price target on Zscaler, implying meaningful upside from current levels. Rosenblatt reaffirms Buy on Zscaler
• Positive Sentiment: Needham also reiterated a Buy rating with a $180 price target, reinforcing Wall Street confidence in Zscaler’s growth outlook. Needham reaffirms Buy on Zscaler
• Positive Sentiment: Zscaler unveiled major AI-security and zero-trust product expansions, including ZAgent Framework, AI Broker, Endpoint AI Security, and AI Access Graph, which positions the company as an early leader in securing agentic AI workloads. Zscaler Redefines Zero Trust SASE for the AI Era
• Positive Sentiment: The company expanded Project AI-Guardian with partners like AWS, Google Cloud, OpenAI, Databricks, and others, suggesting broader ecosystem adoption and more AI-related use cases for its platform. Zscaler Expands AI-Guardian Uniting Tech Giants to Secure Enterprise AI at Scale
• Neutral Sentiment: Management highlighted research showing cybercriminals are using AI to create more targeted phishing attacks, which supports the demand case for Zscaler’s security tools but does not directly change near-term financials. Zscaler Research Finds Cybercrime Economics Are Shifting as AI Trades Mass Volume for Lethal Precision
• Negative Sentiment: Investor concern remains elevated after reports of a stock crash and securities investigation/class-action activity, which can pressure sentiment even when fundamentals and product news are improving. Zscaler’s Stock Lost 31% in One Day. Now Securities Lawyers Are Circling.
• Negative Sentiment: Additional law-firm notices about a possible fraud/securities investigation add legal uncertainty and can weigh on the stock until clarified. ZS Investors Have Opportunity to Join Zscaler, Inc. Fraud Investigation with the Schall Law Firm

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.