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

Zscaler, Inc. (NASDAQ:ZS) gapped up before the market opened on Tuesday. The stock had previously closed at $201.80, but opened at $210.40. Zscaler shares last traded at $207.11, with a volume of 1,693,242 shares.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Analysts raise targets: Needham lifted its target to $255 and maintained a Buy rating, while Cantor Fitzgerald raised its target to $275 and kept an Overweight rating. Other firms, including UBS, JPMorgan, Truist, BNP Paribas Exane, Wedbush and Robert W. Baird, also increased targets, with several now seeing 10%–34% potential upside. Needham raises Zscaler price target
• Positive Sentiment: AI is a major growth catalyst: Analysts say rising enterprise demand to secure AI agents, stronger new-customer sales and broader product offerings could accelerate Zscaler’s growth. New disclosures also highlighted cross-selling potential and additional customer entry points. Zscaler analyst target hikes and AI security growth
• Positive Sentiment: Guidance reaffirmed: Management maintained its first-quarter and fiscal 2027 outlook at investor day, reducing concerns about recent go-to-market leadership changes. Zscaler also announced an IBM and Red Hat partnership to protect private applications during active vulnerability windows, potentially strengthening its enterprise position. Zscaler investor day and guidance
• Neutral Sentiment: Long-term targets face execution risk: RBC and Morgan Stanley see meaningful growth potential from AI security and cross-selling, but Jefferies said Zscaler’s $10 billion fiscal 2031 annual recurring revenue target looks ambitious. BTIG reaffirmed its Neutral rating, underscoring disagreement among analysts about valuation and execution. Jefferies on Zscaler long-term ARR target
• Negative Sentiment: Some caution remains: Morgan Stanley raised its target but retained an Equal Weight rating with a target below the current trading level, while Pomerantz announced an investigation into potential investor claims. The legal announcement does not establish wrongdoing but may add headline risk. Pomerantz investor investigation

Wall Street Analysts Forecast Growth

Several research analysts have recently weighed in on ZS shares. Royal Bank Of Canada reissued an “outperform” rating and issued a $236.00 price objective on shares of Zscaler in a research report on Wednesday. Needham & Company LLC increased their price target on Zscaler from $215.00 to $255.00 and gave the stock a “buy” rating in a report on Wednesday. Zacks Research upgraded shares of Zscaler from a “strong sell” rating to a “hold” rating in a research note on Friday, October 2nd. UBS Group raised their price target on shares of Zscaler from $225.00 to $250.00 and gave the stock a “buy” rating in a report on Wednesday. Finally, Wedbush upped their price objective on shares of Zscaler from $215.00 to $240.00 and gave the company an “outperform” rating in a report on Wednesday. Thirty-five 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’s stock. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average price target of $238.07.

Zscaler Trading Up 0.6%

The firm has a market cap of $34.82 billion, a price-to-earnings ratio of -547.56, a P/E/G ratio of 22.12 and a beta of 0.94. The firm’s 50-day moving average is $183.14 and its 200-day moving average is $156.23. The company has a current ratio of 1.70, a quick ratio of 1.70 and a debt-to-equity ratio of 0.65.

Zscaler (NASDAQ:ZS) last released its quarterly earnings data on Thursday, September 3rd. The company reported $1.19 earnings per share for the quarter, beating analysts’ consensus estimates of $1.09 by $0.10. The firm had revenue of $898.19 million for the quarter, compared to analyst estimates of $876.96 million. Zscaler had a negative net margin of 1.88% and a positive return on equity of 1.23%. The business’s quarterly revenue was up 24.9% compared to the same quarter last year. During the same period last year, the firm earned $0.89 earnings per share. 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, sell-side analysts anticipate that Zscaler, Inc. will post 0.7 EPS for the current fiscal year.

Insider Activity

In related news, insider Adam Geller sold 661 shares of the stock in a transaction on Monday, September 21st. The stock was sold at an average price of $200.00, for a total value of $132,200.00. Following the completion of the sale, the insider directly owned 38,308 shares of the company’s stock, valued at approximately $7,661,600. This represents a 1.70% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Robert Schlossman sold 5,394 shares of Zscaler stock in a transaction on Monday, September 21st. The stock was sold at an average price of $200.00, for a total transaction of $1,078,800.00. Following the transaction, the insider directly owned 61,525 shares in the company, valued at $12,305,000. This represents a 8.06% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 29,053 shares of company stock worth $5,610,165. Company insiders own 17.20% of the company’s stock.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in the company. Parkside Financial Bank & Trust boosted its holdings in Zscaler by 18.8% during the 2nd quarter. Parkside Financial Bank & Trust now owns 417 shares of the company’s stock valued at $59,000 after acquiring an additional 66 shares during the period. Elevation Wealth Partners LLC increased its stake in Zscaler by 84.3% in the third quarter. Elevation Wealth Partners LLC now owns 153 shares of the company’s stock worth $31,000 after purchasing an additional 70 shares during the period. Versant Capital Management Inc lifted its position in shares of Zscaler by 45.6% during the third quarter. Versant Capital Management Inc now owns 230 shares of the company’s stock worth $46,000 after purchasing an additional 72 shares during the last quarter. Koshinski Asset Management Inc. lifted its position in shares of Zscaler by 2.7% during the first quarter. Koshinski Asset Management Inc. now owns 3,036 shares of the company’s stock worth $426,000 after purchasing an additional 79 shares during the last quarter. Finally, J.W. Cole Advisors Inc. boosted its stake in shares of Zscaler by 2.0% during the fourth quarter. J.W. Cole Advisors Inc. now owns 4,106 shares of the company’s stock valued at $908,000 after purchasing an additional 80 shares during the period. 46.45% of the stock is owned by institutional investors.

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.