Zscaler (NASDAQ:ZS) Shares Down 2.7% – What’s Next?

Zscaler, Inc. (NASDAQ:ZS) shares fell 2.7% during mid-day trading on Thursday . The company traded as low as $122.15 and last traded at $123.80. 2,312,053 shares changed hands during trading, a decline of 37% from the average daily volume of 3,684,192 shares. The stock had previously closed at $127.27.

Trending Headlines about Zscaler

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Zscaler announced a multi-year partnership with Aston Martin Aramco Formula One Team, which will use Zscaler’s Zero Trust Exchange platform to secure sensitive design, strategy, and race data. Article Title
• Positive Sentiment: Zscaler CEO Jay Chaudhry highlighted AI as a major cybersecurity opportunity, reinforcing the company’s positioning in a fast-growing market. Article Title
• Positive Sentiment: Another report said AI could create the biggest cybersecurity opportunity in years, which supports the investment case for Zscaler’s AI-era security platform. Article Title
• Neutral Sentiment: Market commentary noted Zscaler had only a modest post-earnings move, suggesting traders are still assessing the company’s near-term outlook. Article Title
• Neutral Sentiment: Pomerantz LLP said it is investigating claims on behalf of Zscaler investors, which may add headline risk but does not by itself confirm wrongdoing. Article Title
• Negative Sentiment: Zscaler CFO Kevin Rubin sold 3,000 shares under a pre-arranged trading plan, which can still weigh on sentiment even though the sale was routine. Article Title

Wall Street Analysts Forecast Growth

Several equities research analysts have recently issued reports on the company. Berenberg Bank set a $200.00 price target on Zscaler in a report on Thursday, May 28th. Scotiabank reduced their target price on shares of Zscaler from $190.00 to $175.00 and set a “sector outperform” rating for the company in a research note on Wednesday, May 27th. Wolfe Research restated an “outperform” rating and set a $150.00 price target on shares of Zscaler in a research note on Thursday, June 11th. Stifel Nicolaus reduced their price objective on shares of Zscaler from $180.00 to $175.00 and set a “buy” rating for the company in a research note on Wednesday, May 27th. Finally, Barclays reduced their price objective on shares of Zscaler from $180.00 to $170.00 and set an “overweight” rating for the company in a research note on Wednesday, May 27th. Thirty-four analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average price target of $213.97.

Zscaler Stock Performance

The company has a market cap of $21.39 billion, a P/E ratio of -275.54, a price-to-earnings-growth ratio of 77.40 and a beta of 0.97. 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 stock’s 50-day moving average price is $141.59 and its 200 day moving average price is $168.93.

Zscaler (NASDAQ:ZS) last posted its quarterly earnings data on Tuesday, May 26th. The company reported $1.08 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.01 by $0.07. The business had revenue of $850.48 million during 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%. Zscaler’s quarterly revenue was up 25.4% compared to the same quarter last year. During the same period in the prior year, the firm 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. As a group, research analysts expect that Zscaler, Inc. will post 0.11 EPS for the current fiscal year.

Insiders Place Their Bets

In related news, CFO Kevin Rubin sold 3,000 shares of the business’s stock in a transaction dated Thursday, June 25th. The stock was sold at an average price of $124.22, for a total transaction of $372,660.00. Following the completion of the transaction, the chief financial officer owned 41,901 shares of the company’s stock, valued at approximately $5,204,942.22. The trade was a 6.68% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Jagtar Singh Chaudhry sold 2,878 shares of the stock in a transaction that occurred on Tuesday, June 16th. The shares were sold at an average price of $126.43, for a total value of $363,865.54. Following the completion of the sale, the chief executive officer directly owned 343,038 shares of the company’s stock, valued at $43,370,294.34. This represents a 0.83% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders have sold 15,644 shares of company stock valued at $1,960,287. Company insiders own 17.20% of the company’s stock.

Institutional Investors Weigh In On Zscaler

Several hedge funds have recently made changes to their positions in the stock. Goldstream Capital Management Ltd raised its holdings in Zscaler by 0.3% in the 3rd quarter. Goldstream Capital Management Ltd now owns 12,450 shares of the company’s stock valued at $3,731,000 after acquiring an additional 34 shares in the last quarter. Kentucky Retirement Systems Insurance Trust Fund grew its holdings in shares of Zscaler by 1.4% during the 3rd quarter. Kentucky Retirement Systems Insurance Trust Fund now owns 2,569 shares of the company’s stock worth $770,000 after purchasing an additional 36 shares in the last quarter. Advisor OS LLC increased its position in shares of Zscaler by 4.6% during the third quarter. Advisor OS LLC now owns 879 shares of the company’s stock valued at $263,000 after purchasing an additional 39 shares during the period. Parallel Advisors LLC raised its stake in shares of Zscaler by 10.9% in the third quarter. Parallel Advisors LLC now owns 397 shares of the company’s stock valued at $119,000 after purchasing an additional 39 shares in the last quarter. Finally, Smartleaf Asset Management LLC raised its stake in shares of Zscaler by 7.5% in the second quarter. Smartleaf Asset Management LLC now owns 648 shares of the company’s stock valued at $204,000 after purchasing an additional 45 shares in the last quarter. 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.