Zscaler (NASDAQ:ZS) Shares Gap Down – Here’s What Happened

Zscaler, Inc. (NASDAQ:ZS) shares gapped down before the market opened on Friday. The stock had previously closed at $214.64, but opened at $206.00. Zscaler shares last traded at $196.63, with a volume of 1,063,462 shares changing hands.

Zscaler News Summary

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Mizuho raised its price target for Zscaler from $210 to $220 and maintained an “Outperform” rating, citing potential upside from current trading levels.
• Positive Sentiment: Zscaler recently launched its Agentic SOC, an AI-focused security operations platform that uses proprietary telemetry, zero-trust data and AI agents developed with Anthropic and OpenAI. The offering could strengthen the company’s competitive position in AI-driven cybersecurity.
• Positive Sentiment: The company is scheduled to hold an Investor Day on October 6, where management is expected to discuss its strategy, long-term growth drivers and financial outlook. Zscaler to Host Investor Day on October 6
• Neutral Sentiment: Analysts and market commentary continue to identify Zscaler as a long-term growth stock, supported by its cybersecurity platform and expansion opportunities. However, these assessments do not represent a new operating announcement or near-term earnings catalyst. Why Zscaler Is a Top Growth Stock for the Long-Term
• Negative Sentiment: Chief Revenue Officer Mike Rich is stepping down for personal reasons, effective October 1. Ross Tackett, Zscaler’s worldwide head of sales, will succeed him. Investors appear concerned about potential disruption to sales execution and customer momentum, despite the internal promotion and analysts’ view that the transition should be limited. Zscaler Shares Slide on CRO Departure, but Analysts See Limited Disruption

Analyst Ratings Changes

ZS has been the topic of several research reports. Weiss Ratings cut Zscaler from a “sell (d-)” rating to a “sell (e+)” rating in a report on Thursday, September 10th. Mizuho increased their price target on Zscaler from $210.00 to $220.00 and gave the company an “outperform” rating in a research note on Friday. Wells Fargo & Company raised their price target on Zscaler from $210.00 to $215.00 and gave the company an “overweight” rating in a report on Friday, September 4th. Citigroup lifted their price objective on Zscaler from $175.00 to $205.00 and gave the stock a “buy” rating in a research note on Tuesday, September 8th. Finally, JPMorgan Chase & Co. upped their price objective on Zscaler from $205.00 to $215.00 and gave the stock an “overweight” rating in a report on Wednesday, August 26th. Thirty-four equities research analysts have rated the stock with a Buy rating, six have assigned a Hold rating and two have issued a Sell rating to the company. Based on data from MarketBeat, Zscaler has an average rating of “Moderate Buy” and a consensus target price of $219.28.

Zscaler Price Performance

The company has a current ratio of 1.70, a quick ratio of 1.70 and a debt-to-equity ratio of 0.65. The firm’s 50-day moving average price is $173.38 and its 200-day moving average price is $153.31. The stock has a market capitalization of $32.08 billion, a PE ratio of -501.23, a PEG ratio of 23.95 and a beta of 0.95.

Zscaler (NASDAQ:ZS) last released its quarterly earnings results on Thursday, September 3rd. The company reported $1.19 EPS for the quarter, topping the consensus estimate 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 during the quarter, compared to analyst estimates of $876.96 million. During the same quarter last year, the business posted $0.89 earnings per share. The firm’s 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. On average, equities analysts forecast that Zscaler, Inc. will post 0.64 EPS for the current fiscal year.

Insider Transactions at Zscaler

In related news, CEO Jagtar Chaudhry sold 2,852 shares of the firm’s stock in a transaction on Wednesday, September 16th. The stock was sold at an average price of $192.76, for a total value of $549,751.52. Following the completion of the sale, the chief executive officer directly owned 340,186 shares in the company, valued at $65,574,253.36. This trade represents a 0.83% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director James A. Beer sold 177 shares of Zscaler stock in a transaction on Thursday, September 17th. The stock was sold at an average price of $192.01, for a total transaction of $33,985.77. Following the transaction, the director directly owned 4,030 shares of the company’s stock, valued at $773,800.30. The trade was a 4.21% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders have sold 28,656 shares of company stock worth $5,526,076. 17.20% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Zscaler

Several hedge funds and other institutional investors have recently made changes to their positions in the company. BlackRock Inc. purchased a new stake in Zscaler in the 2nd quarter worth about $1,396,028,000. First Trust Advisors LP boosted its position in shares of Zscaler by 36.2% during the first quarter. First Trust Advisors LP now owns 3,518,678 shares of the company’s stock valued at $493,635,000 after buying an additional 935,781 shares during the period. Geode Capital Management LLC grew its stake in shares of Zscaler by 5.0% during the fourth quarter. Geode Capital Management LLC now owns 2,069,630 shares of the company’s stock valued at $464,783,000 after buying an additional 98,140 shares during the last quarter. Pictet Asset Management Holding SA grew its stake in shares of Zscaler by 52.5% during the first quarter. Pictet Asset Management Holding SA now owns 1,920,540 shares of the company’s stock valued at $269,285,000 after buying an additional 661,413 shares during the last quarter. Finally, Amundi raised its holdings in shares of Zscaler by 12.8% in the second quarter. Amundi now owns 1,137,837 shares of the company’s stock worth $160,606,000 after buying an additional 129,563 shares during the period. Hedge funds and other institutional investors own 46.45% of the company’s stock.

Zscaler Company Profile

Zscaler, Inc is a cloud-native cybersecurity company that provides security services designed to help organizations connect users, devices, applications and workloads securely over the internet. Its platform is built around a zero-trust security model, which verifies access based on identity, context and policy rather than relying primarily on a traditional corporate network perimeter.

The company’s offerings include Zscaler Internet Access, which secures access to internet and software-as-a-service applications, and Zscaler Private Access, which provides secure, policy-based access to private applications without requiring conventional virtual private networks.