Deutsche Bank Aktiengesellschaft Issues Pessimistic Forecast for Zscaler (NASDAQ:ZS) Stock Price

Key Points

• Deutsche Bank cut its price target on Zscaler from $185 to $175, while keeping a buy rating. The new target still implies about 29.9% upside from the stock’s prior close.
• Zscaler reported strong fiscal Q3 results, with EPS of $1.08 and revenue of $850.5 million, both above analyst expectations. Revenue rose 25.4% year over year, and the company also raised its fiscal 2026 guidance.
• Despite mixed signals from some analysts, Wall Street remains generally constructive on the stock: the consensus rating is Moderate Buy with an average price target of $229.36. Insider selling and cautious commentary about competition and spending pressure, however, add some near-term skepticism.

Zscaler (NASDAQ:ZS - Get Free Report) had its target price reduced by equities researchers at Deutsche Bank Aktiengesellschaft from $185.00 to $175.00 in a research note issued to investors on Wednesday,MarketScreener reports. The brokerage currently has a "buy" rating on the stock. Deutsche Bank Aktiengesellschaft's target price points to a potential upside of 29.88% from the stock's previous close.

Several other analysts have also issued reports on the company. TD Cowen reiterated a "buy" rating on shares of Zscaler in a report on Wednesday. Guggenheim reissued a "neutral" rating on shares of Zscaler in a research report on Wednesday. HC Wainwright raised shares of Zscaler from a "buy" rating to a "buy" rating in a report on Monday, May 18th. Needham & Company LLC reiterated a "buy" rating and set a $180.00 price target on shares of Zscaler in a report on Wednesday. Finally, Wells Fargo & Company started coverage on Zscaler in a research note on Tuesday, March 3rd. They issued an "overweight" rating and a $200.00 price objective on the stock. Two research analysts have rated the stock with a Strong Buy rating, thirty have given a Buy rating, seven have given a Hold rating and three have given a Sell rating to the company's stock. According to data from MarketBeat.com, Zscaler has an average rating of "Moderate Buy" and a consensus price target of $229.36.

Zscaler Price Performance

NASDAQ ZS opened at $134.74 on Wednesday. The firm's 50 day moving average is $145.75 and its 200-day moving average is $192.65. The company has a quick ratio of 1.90, a current ratio of 1.90 and a debt-to-equity ratio of 0.78. The company has a market capitalization of $21.66 billion, a PE ratio of -318.90 and a beta of 0.96. Zscaler has a 12-month low of $114.63 and a 12-month high of $336.99.

Zscaler (NASDAQ:ZS - Get Free Report) last announced its earnings results on Tuesday, May 26th. The company reported $1.08 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 analysts' expectations of $835.60 million. Zscaler had a negative net margin of 2.25% and a positive return on equity of 0.06%. The firm's revenue was up 25.4% on a year-over-year basis. During the same quarter in the prior year, the company posted $0.84 earnings per share. Zscaler has set its Q4 2026 guidance at 1.080-1.090 EPS and its FY 2026 guidance at 4.100-4.110 EPS. Equities research analysts anticipate that Zscaler will post -0.03 earnings per share for the current fiscal year.

Insider Transactions at Zscaler

In other Zscaler news, CFO Kevin Rubin sold 1,682 shares of the company's stock in a transaction on Tuesday, March 17th. The stock was sold at an average price of $156.59, for a total value of $263,384.38. Following the transaction, the chief financial officer directly owned 46,479 shares of the company's stock, valued at $7,278,146.61. This represents a 3.49% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through this hyperlink. Also, CEO Jagtar Singh Chaudhry sold 1,941 shares of Zscaler stock in a transaction on Tuesday, March 17th. The stock was sold at an average price of $156.59, for a total value of $303,941.19. Following the sale, the chief executive officer directly owned 345,916 shares of the company's stock, valued at $54,166,986.44. This represents a 0.56% decrease in their position. The SEC filing for this sale provides additional information. Over the last quarter, insiders sold 12,130 shares of company stock worth $1,892,487. 17.20% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Zscaler

Large investors have recently added to or reduced their stakes in the stock. Bessemer Group Inc. raised its holdings in Zscaler by 3.2% in the 3rd quarter. Bessemer Group Inc. now owns 1,021 shares of the company's stock valued at $306,000 after acquiring an additional 32 shares in the last quarter. Wedbush Securities Inc. grew its holdings in shares of Zscaler by 0.7% during the 3rd quarter. Wedbush Securities Inc. now owns 5,129 shares of the company's stock worth $1,537,000 after purchasing an additional 34 shares in the last quarter. Goldstream Capital Management Ltd grew its holdings in shares of Zscaler by 0.3% during the 3rd quarter. Goldstream Capital Management Ltd now owns 12,450 shares of the company's stock worth $3,731,000 after purchasing an additional 34 shares in the last quarter. Kentucky Retirement Systems Insurance Trust Fund increased its position in shares of Zscaler by 1.4% in the third 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 during the period. Finally, Advisor OS LLC raised its stake in Zscaler by 4.6% in 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 in the last quarter. Institutional investors and hedge funds own 46.45% of the company's stock.

Zscaler News Summary

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Zscaler reported fiscal Q3 revenue of $850.5 million and EPS of $1.08, both above estimates, while revenue rose 25% year over year and ARR also grew 25%, reinforcing the company’s strong core demand. Article: Zscaler Announces Strong Third-Quarter Fiscal 2026 Results
• Positive Sentiment: Management raised FY26 guidance and pointed to strength in AI security and record margins, which supports the long-term growth narrative for the cybersecurity platform. Article: ZS Q3 Earnings Call Flags Prudent Growth Outlook
• Positive Sentiment: Several analysts still view the stock favorably despite trimming targets, with Rosenblatt, Bernstein, Baird, and Needham maintaining bullish or buy-equivalent ratings, suggesting Wall Street still sees upside from current levels. Article: Analyst target updates
• Neutral Sentiment: New commentary on Zscaler’s AI security strategy and product expansion adds to the growth story, but also notes the stock may still need stronger execution to justify its valuation. Article: As Zscaler Doubles Down on AI Security, ZS Stock Still Needs More to Justify Its Steep Valuation
• Negative Sentiment: Despite the beat, Zscaler’s guidance disappointed traders: the company forecast fourth-quarter revenue slightly below estimates, and Reuters said the outlook reflected intensifying competition in cybersecurity and more cautious enterprise spending. Article: Zscaler sees downbeat quarterly revenue as competition heats up in cybersecurity market
• Negative Sentiment: Some recent analyst notes turned more cautious, including a Seeking Alpha downgrade citing slowing organic growth, weaker net-new ARR momentum, and competitive pressure from integrated security platforms. Article: Zscaler Q1: I Was Right (Rating Downgrade)

Zscaler Company 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.

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