Zscaler (NASDAQ:ZS) Shares Down 2.6% – What’s Next?

Zscaler, Inc. (NASDAQ:ZS)’s share price traded down 2.6% during mid-day trading on Tuesday . The stock traded as low as $120.85 and last traded at $125.84. 4,752,210 shares traded hands during mid-day trading, an increase of 32% from the average session volume of 3,598,024 shares. The stock had previously closed at $129.25.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Zscaler unveiled new AI-security products for “agentic AI,” including Zero Trust controls for AI agents, AI Broker, Endpoint AI Security, and AI Access Graph, which could strengthen its competitive position and support future demand. Zscaler Unveils New Product Innovations to Secure Agentic AI
• Positive Sentiment: The company expanded Project AI-Guardian with major technology partners such as AWS, Google Cloud, OpenAI, Databricks, and Saviynt, signaling broader ecosystem adoption and potential cross-selling opportunities. Zscaler Expands AI-Guardian, Uniting Tech Giants to Secure Enterprise AI at Scale
• Positive Sentiment: Zscaler said the AI-security market is being reshaped by autonomous agents, reinforcing its growth narrative as enterprises look for new ways to secure AI workloads. Zscaler CEO: AI Will Create ‘Billions of Agents’ That Need Cybersecurity Protection
• Neutral Sentiment: Radiant Logic announced a partnership with Zscaler to improve Day 1 access for M&A identity workflows, adding another integration to its zero-trust ecosystem. Radiant Logic Forms Technology Partnership with Zscaler
• Negative Sentiment: Multiple legal notices and a securities class-action deadline reminder are adding an overhang, which can pressure sentiment even if they do not yet imply a final adverse outcome. ZS DEADLINE: The Gross Law Firm Reminds Zscaler Investors
• Negative Sentiment: Separate law-firm investigations into possible securities law violations may be contributing to caution around the name. ZS Investors Have Opportunity to Join Zscaler Fraud Investigation
• Negative Sentiment: Recent insider activity remains one-sided, with 18 open-market sales and no purchases over the last six months, which can weigh on investor confidence. Quiver AI Summary on Zscaler Innovations

Analysts Set New Price Targets

Several equities research analysts have recently issued reports on the stock. Deutsche Bank Aktiengesellschaft lowered their target price on shares of Zscaler from $185.00 to $175.00 and set a “buy” rating for the company in a report on Wednesday, May 27th. Robert W. Baird lowered their target price on shares of Zscaler from $265.00 to $230.00 and set an “outperform” rating for the company in a report on Wednesday, May 27th. JPMorgan Chase & Co. reduced their price target on shares of Zscaler from $250.00 to $205.00 and set an “overweight” rating on the stock in a research note on Wednesday, May 27th. Citizens Jmp reduced their price target on shares of Zscaler from $290.00 to $210.00 and set a “market outperform” rating on the stock in a research note on Friday, May 1st. Finally, Zacks Research raised shares of Zscaler from a “strong sell” rating to a “hold” rating in a research note on Wednesday, May 27th. Thirty-three research 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’s stock. According to MarketBeat.com, the company currently has an average rating of “Moderate Buy” and a consensus price target of $216.03.

Zscaler Stock Down 2.6%

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 firm has a market cap of $20.35 billion, a PE ratio of -262.16 and a beta of 0.97. The business’s 50-day simple moving average is $143.37 and its 200 day simple moving average is $181.49.

Zscaler (NASDAQ:ZS) last posted its earnings results on Tuesday, May 26th. The company reported $1.08 EPS for the quarter, beating analysts’ consensus estimates of $1.01 by $0.07. The business had revenue of $850.48 million for the quarter, compared to the consensus estimate of $835.14 million. Zscaler had a negative net margin of 2.44% and a negative return on equity of 0.37%. The company’s revenue for the quarter was up 25.4% on a year-over-year basis. During the same quarter last year, the firm 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. As a group, equities research analysts expect that Zscaler, Inc. will post -0.03 earnings per share for the current year.

Insider Buying and Selling at Zscaler

In other Zscaler news, insider Robert Schlossman sold 2,263 shares of the firm’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 $354,363.17. Following the transaction, the insider owned 72,390 shares of the company’s stock, valued at approximately $11,335,550.10. This trade represents a 3.03% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CEO Jagtar Singh Chaudhry sold 1,941 shares of the firm’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 $303,941.19. Following the transaction, the chief executive officer directly owned 345,916 shares in the company, valued at $54,166,986.44. This trade represents a 0.56% decrease in their position. The SEC filing for this sale provides additional information. In the last ninety days, insiders have sold 12,130 shares of company stock worth $1,892,487. 17.20% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently modified their holdings of ZS. Binnacle Investments Inc purchased a new position in shares of Zscaler in the 3rd quarter worth approximately $25,000. AlphaCentric Advisors LLC purchased a new position in shares of Zscaler in the 4th quarter worth approximately $29,000. Picton Mahoney Asset Management purchased a new position in shares of Zscaler in the 3rd quarter worth approximately $30,000. University of Texas Texas AM Investment Management Co. purchased a new position in shares of Zscaler in the 4th quarter worth approximately $30,000. Finally, Mcguire Capital Advisors Inc. purchased a new position in shares of Zscaler in the 4th quarter worth approximately $32,000. Hedge funds and other institutional investors own 46.45% of the company’s stock.

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.