Royal Bank Of Canada Reaffirms “Outperform” Rating for Zscaler (NASDAQ:ZS)

Zscaler (NASDAQ:ZS)‘s stock had its “outperform” rating reissued by stock analysts at Royal Bank Of Canada in a research report issued to clients and investors on Wednesday, Benzinga reports. They presently have a $236.00 price target on the stock. Royal Bank Of Canada’s target price suggests a potential upside of 0.97% from the stock’s current price.

ZS has been the topic of several other reports. Canaccord Genuity Group lifted their price target on shares of Zscaler from $210.00 to $250.00 and gave the company a “buy” rating in a report on Wednesday. KeyCorp increased their price objective on shares of Zscaler from $185.00 to $210.00 and gave the company an “overweight” rating in a research note on Friday, August 21st. JPMorgan Chase & Co. boosted their target price on shares of Zscaler from $205.00 to $215.00 and gave the stock an “overweight” rating in a research note on Wednesday, August 26th. Stephens upped their price target on shares of Zscaler from $225.00 to $265.00 and gave the stock an “overweight” rating in a report on Wednesday. Finally, Barclays increased their price target on Zscaler from $220.00 to $225.00 and gave the company an “overweight” rating in a research note on Wednesday. Thirty-five research analysts have rated the stock with a Buy rating, seven have given a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, Zscaler has an average rating of “Moderate Buy” and a consensus price target of $239.41.

Zscaler Price Performance

Shares of ZS traded up $16.92 during midday trading on Wednesday, hitting $233.73. The company’s stock had a trading volume of 3,795,230 shares, compared to its average volume of 3,372,607. The company has a quick ratio of 1.70, a current ratio of 1.70 and a debt-to-equity ratio of 0.65. Zscaler has a one year low of $114.63 and a one year high of $336.99. The stock has a market capitalization of $38.11 billion, a price-to-earnings ratio of -599.31, a price-to-earnings-growth ratio of 22.25 and a beta of 0.94. The company’s fifty day simple moving average is $184.50 and its two-hundred day simple moving average is $156.69.

Zscaler (NASDAQ:ZS) last announced its quarterly earnings data on Thursday, September 3rd. The company reported $1.19 earnings per share for the quarter, topping the consensus estimate of $1.09 by $0.10. The business had revenue of $898.19 million during the quarter, compared to the consensus estimate of $876.96 million. Zscaler had a positive return on equity of 1.23% and a negative net margin of 1.88%.Zscaler’s revenue for the quarter was up 24.9% on a year-over-year basis. During the same period in the prior year, the company earned $0.89 EPS. Zscaler has set its FY 2027 guidance at 4.860-4.900 EPS and its Q1 2027 guidance at 1.150-1.160 EPS. As a group, equities analysts expect that Zscaler will post 0.7 earnings per share for the current fiscal year.

Insider Buying and Selling at Zscaler

In related news, CFO Kevin Rubin sold 5,957 shares of the stock in a transaction on Wednesday, September 16th. The stock was sold at an average price of $192.76, for a total value of $1,148,271.32. Following the completion of the sale, the chief financial officer directly 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. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Adam Geller sold 5,578 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 $1,075,215.28. Following the transaction, the insider directly owned 43,553 shares of the company’s stock, valued at approximately $8,395,276.28. This represents a 11.35% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 29,053 shares of company stock valued at $5,610,165. Insiders own 17.20% of the company’s stock.

Institutional Investors Weigh In On Zscaler

Institutional investors have recently made changes to their positions in the stock. BlackRock Inc. acquired a new stake in shares of Zscaler in the second quarter valued at about $1,396,028,000. First Trust Advisors LP lifted its stake in shares of Zscaler by 36.2% in the first quarter. First Trust Advisors LP now owns 3,518,678 shares of the company’s stock worth $493,635,000 after acquiring an additional 935,781 shares during the period. Pictet Asset Management Holding SA boosted its holdings in Zscaler by 52.5% in 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 acquiring an additional 661,413 shares during the last quarter. Amundi increased its position in Zscaler by 12.8% during the 2nd quarter. Amundi now owns 1,137,837 shares of the company’s stock valued at $160,606,000 after purchasing an additional 129,563 shares during the period. Finally, Wellington Management Group LLP raised its holdings in Zscaler by 23.5% during the 2nd quarter. Wellington Management Group LLP now owns 1,103,212 shares of the company’s stock worth $155,718,000 after purchasing an additional 209,711 shares during the last quarter. Institutional investors own 46.45% of the company’s stock.

Key Stories Impacting Zscaler

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Zscaler reaffirmed its fiscal 2027 outlook, including quarterly revenue of approximately $935 million–$939 million and full-year revenue of about $3.91 billion–$3.94 billion. Maintaining guidance appears to have eased concerns about a potential slowdown in cloud-security spending. Zscaler Is Up After Reaffirming 2027 Outlook and Expanding AI Security Partnership
• Positive Sentiment: The company announced a security collaboration with IBM and Red Hat to help protect private applications during the period between vulnerability disclosure and software patching. The partnership reinforces Zscaler’s positioning in AI-enabled, zero-trust security. Zscaler Jumps on Reaffirmed Revenue Outlook and IBM Security Pact
• Positive Sentiment: Zscaler outlined ambitious long-term recurring-revenue goals, including more than $8 billion of organic annual recurring revenue by fiscal 2031. Investors viewed the targets as evidence of substantial multi-year growth potential. Zscaler Expects More Than $8 Billion in Organic ARR by FY31
• Positive Sentiment: Analyst sentiment improved, with Citizens JMP raising its price target to $265 and UBS lifting its target to $250 while assigning a Buy rating. RBC, Truist, BNP Paribas Exane, Wedbush, and Cantor Fitzgerald also maintained positive views.
• Neutral Sentiment: Amerx initiated coverage with a Buy rating, adding another favorable opinion but with limited detail on valuation or financial estimates. Amerx Initiates Coverage of Zscaler at Buy
• Negative Sentiment: Some analysts cautioned that the long-term ARR ambitions may be difficult to achieve, while investors continue to weigh slowing growth, rising costs, and the need for stronger customer expansion. A law firm’s investigation of potential investor claims adds a secondary overhang, although no wrongdoing has been established. Jefferies Says Zscaler’s Long-Term ARR Target Looks Ambitious

Zscaler Company Profile

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

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