Nicholas Investment Partners LP Trims Stake in Zscaler, Inc. $ZS

Nicholas Investment Partners LP trimmed its stake in Zscaler, Inc. (NASDAQ:ZS) by 55.4% in the 4th quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The institutional investor owned 5,387 shares of the company’s stock after selling 6,704 shares during the period. Nicholas Investment Partners LP’s holdings in Zscaler were worth $1,212,000 at the end of the most recent reporting period.

Other hedge funds and other institutional investors have also recently modified their holdings of the company. Groupama Asset Managment boosted its holdings in Zscaler by 76,352.6% in the 3rd quarter. Groupama Asset Managment now owns 4,750,000 shares of the company’s stock worth $1,423,385,000 after buying an additional 4,743,787 shares during the period. AQR Capital Management LLC boosted its holdings in Zscaler by 61.8% in the 3rd quarter. AQR Capital Management LLC now owns 1,941,571 shares of the company’s stock worth $576,083,000 after buying an additional 741,756 shares during the period. Vanguard Group Inc. boosted its holdings in Zscaler by 6.1% in the 3rd quarter. Vanguard Group Inc. now owns 11,367,903 shares of the company’s stock worth $3,406,506,000 after buying an additional 652,771 shares during the period. Alyeska Investment Group L.P. bought a new position in Zscaler in the 3rd quarter worth $109,440,000. Finally, First Trust Advisors LP boosted its holdings in Zscaler by 15.9% in the 4th quarter. First Trust Advisors LP now owns 2,582,897 shares of the company’s stock worth $580,945,000 after buying an additional 354,763 shares during the period. 46.45% of the stock is currently owned by hedge funds and other institutional investors.

Zscaler Stock Up 2.7%

Shares of NASDAQ ZS opened at $129.52 on Friday. The firm’s 50-day moving average price is $142.55 and its 200-day moving average price is $177.84. The company has a current ratio of 1.86, a quick ratio of 1.86 and a debt-to-equity ratio of 0.72. The stock has a market capitalization of $20.94 billion, a price-to-earnings ratio of -269.83, a P/E/G ratio of 80.98 and a beta of 0.97. Zscaler, Inc. has a 12-month low of $114.63 and a 12-month high of $336.99.

Zscaler (NASDAQ:ZS) last announced its earnings results 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 firm 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%. The business’s revenue was up 25.4% compared to the same quarter last year. During the same period in the prior year, the company earned $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, equities research analysts anticipate that Zscaler, Inc. will post 0.11 EPS for the current fiscal year.

Insider Activity

In other news, CFO Kevin Rubin sold 1,682 shares of the company’s stock in a transaction dated Tuesday, March 17th. The shares were sold at an average price of $156.59, for a total transaction of $263,384.38. Following the sale, the chief financial officer directly owned 46,479 shares in the company, valued at approximately $7,278,146.61. This represents a 3.49% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Raj Judge sold 2,488 shares of the company’s stock in a transaction dated Tuesday, March 17th. The shares were sold at an average price of $156.59, for a total transaction of $389,595.92. Following the sale, the executive vice president owned 67,906 shares in the company, valued at $10,633,400.54. This represents a 3.53% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last three months, insiders sold 12,130 shares of company stock worth $1,892,487. 17.20% of the stock is owned by insiders.

Analyst Upgrades and Downgrades

Several research analysts recently weighed in on the stock. Wedbush reaffirmed an “outperform” rating and issued a $220.00 target price on shares of Zscaler in a report on Wednesday. Guggenheim reaffirmed a “buy” rating and issued a $214.00 target price on shares of Zscaler in a report on Wednesday. B. Riley Financial dropped their target price on shares of Zscaler from $225.00 to $215.00 and set a “buy” rating for the company in a report on Wednesday, May 27th. Cantor Fitzgerald reaffirmed an “overweight” rating and issued a $225.00 target price on shares of Zscaler in a report on Wednesday. Finally, Zacks Research raised shares of Zscaler from a “strong sell” rating to a “hold” rating in a report on Wednesday, May 27th. Thirty-four investment analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, Zscaler currently has a consensus rating of “Moderate Buy” and an average price target of $214.33.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Stephens reaffirmed Overweight on Zscaler and set a $200 price target, implying substantial upside from current levels.
• Positive Sentiment: Canaccord Genuity also reiterated Buy and raised its target to $210, signaling continued analyst confidence in Zscaler’s growth outlook.
• Positive Sentiment: Zscaler unveiled new AI-driven security features for its Zero Trust SASE platform, including the ZAgent Framework and other offerings aimed at securing AI agents, endpoints, partners, unmanaged devices, and Kubernetes environments. Zscaler Bets On AI Agent Security And Identity To Revive Growth
• Positive Sentiment: The company also expanded its Zero Trust SASE solution for a world of AI and distributed users, reinforcing its positioning in a fast-growing security niche. Zscaler expands Zero Trust SASE solution for ‘a world of AI with distributed users’
• Neutral Sentiment: Recent media coverage and Zacks commentary show Zscaler remains one of the more closely watched software names, with investors focused on whether AI-related demand can offset slowing growth expectations.
• Neutral Sentiment: Management commentary at recent events emphasized zero trust as a foundation for deploying AI agents, which supports the long-term thesis but does not appear to be an immediate catalyst.
• Negative Sentiment: Zacks noted that Zscaler is trading near a 52-week low after FY27 guidance pointed to slower growth, even though AI security bookings and platform gains may help support the stock.
• Negative Sentiment: The Schall Law Firm announced a fraud investigation into possible false or misleading statements, adding legal and reputational overhang for investors.

Zscaler Profile

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.