Bank of America Corp DE Acquires New Stake in Zscaler, Inc. $ZS

Key Points

• Bank of America acquired 444,111 Zscaler shares worth approximately $62.7 million during the second quarter, giving it about a 0.27% stake. Other institutions also initiated or increased positions, while institutional investors collectively own 46.45% of the company.
• Zscaler reported quarterly EPS of $1.19, ahead of the $1.09 consensus estimate, while revenue rose 24.9% year over year to $898.19 million. Analysts maintain a “Moderate Buy” consensus rating with an average price target of $218.38.
• Insiders sold shares during the quarter, including the CEO and other executives, primarily to cover tax obligations or under pre-arranged trading plans. Investors remain focused on whether slowing recurring-revenue growth could challenge Zscaler’s premium valuation.

Bank of America Corp DE acquired a new stake in Zscaler, Inc. (NASDAQ:ZS - Free Report) during the 2nd quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission. The institutional investor acquired 444,111 shares of the company's stock, valued at approximately $62,686,000. Bank of America Corp DE owned about 0.27% of Zscaler as of its most recent SEC filing.

A number of other hedge funds and other institutional investors have also bought and sold shares of the business. Caisse de depot et placement du Quebec purchased a new position in Zscaler during the 2nd quarter worth $31,141,000. Man Group plc bought a new position in Zscaler during the 2nd quarter worth about $29,480,000. Jupiter Topco LLC purchased a new position in Zscaler during the 2nd quarter valued at about $1,498,000. Wedbush Fund Advisers LLC increased its position in Zscaler by 36.8% during the 2nd quarter. Wedbush Fund Advisers LLC now owns 146,077 shares of the company's stock valued at $20,619,000 after purchasing an additional 39,296 shares during the period. Finally, EFG International AG bought a new stake in shares of Zscaler in the 2nd quarter valued at about $699,000. Hedge funds and other institutional investors own 46.45% of the company's stock.

Insider Transactions at Zscaler

In other news, insider Robert Schlossman sold 2,325 shares of the company's stock in a transaction on Wednesday, September 16th. The shares were sold at an average price of $192.76, for a total value of $448,167.00. Following the sale, the insider directly owned 66,919 shares of the company's stock, valued at $12,899,306.44. This represents a 3.36% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Jagtar Chaudhry sold 2,852 shares of Zscaler stock in a transaction dated Wednesday, September 16th. The shares were sold at an average price of $192.76, for a total value of $549,751.52. Following the transaction, the chief executive officer owned 340,186 shares of the company's stock, valued at $65,574,253.36. The trade was a 0.83% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 28,418 shares of company stock valued at $5,033,100 over the last quarter. Company insiders own 17.20% of the company's stock.

Zscaler Trading Down 0.1%

Zscaler stock opened at $197.31 on Friday. The company has a debt-to-equity ratio of 0.65, a quick ratio of 1.70 and a current ratio of 1.70. The stock has a market cap of $32.17 billion, a PE ratio of -505.92, a price-to-earnings-growth ratio of 23.74 and a beta of 0.95. The stock has a 50-day moving average of $168.22 and a two-hundred day moving average of $151.82. Zscaler, Inc. has a one year low of $114.63 and a one year high of $336.99.

Zscaler (NASDAQ:ZS - Get Free Report) last announced its quarterly earnings data on Thursday, September 3rd. The company reported $1.19 EPS for the quarter, beating the consensus estimate of $1.09 by $0.10. Zscaler had a negative net margin of 1.88% and a positive return on equity of 1.23%. The firm had revenue of $898.19 million during the quarter, compared to analyst estimates of $876.96 million. During the same period last year, the firm posted $0.89 EPS. Zscaler's revenue was up 24.9% on a year-over-year basis. Zscaler has set its FY 2027 guidance at 4.860-4.900 EPS and its Q1 2027 guidance at 1.150-1.160 EPS. On average, research analysts anticipate that Zscaler, Inc. will post 0.61 EPS for the current fiscal year.

Zscaler News Roundup

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: CEO Jagtar Chaudhry discussed AI safety and the importance of human ingenuity, keeping attention on Zscaler’s opportunity to expand into “Security for AI” and data-security solutions. These newer offerings could broaden the company’s long-term growth beyond its traditional seat-based business. Zscaler CEO on AI safety
• Positive Sentiment: Wall Street remains broadly constructive: Zscaler carries a reported “Moderate Buy” consensus rating, with 34 Buy, six Hold and two Sell ratings. The average price target of $218.38 suggests potential upside from recent trading levels, although targets vary considerably.
• Neutral Sentiment: Director James Beer sold 177 shares for approximately $34,000 under a pre-arranged Rule 10b5-1 plan. The relatively small transaction and planned nature make it a limited signal about management’s view of Zscaler’s valuation. Zscaler director share sale
• Neutral Sentiment: CEO Jagtar Chaudhry, CFO Kevin Rubin and insiders Adam Geller and Robert Schlossman also sold shares. The sales were primarily made under pre-arranged plans or to cover tax withholding on vested equity awards, reducing—but not eliminating—their bearish significance.
• Negative Sentiment: Investors remain sensitive to the possibility that slowing annual recurring-revenue growth could pressure Zscaler’s premium valuation, even as revenue, platform adoption and newer security products continue to expand.

Analysts Set New Price Targets

A number of research firms have recently issued reports on ZS. Deutsche Bank Aktiengesellschaft reiterated a "buy" rating on shares of Zscaler in a research note on Friday, September 4th. Piper Sandler increased their target price on Zscaler from $160.00 to $175.00 and gave the company a "neutral" rating in a research report on Friday, September 4th. BTIG Research reiterated a "neutral" rating on shares of Zscaler in a report on Friday, September 4th. Roth Capital reissued a "neutral" rating and issued a $170.00 price target on shares of Zscaler in a research report on Saturday, September 5th. Finally, Wolfe Research restated an "outperform" rating and set a $150.00 price objective on shares of Zscaler in a research note on Thursday, June 11th. Thirty-four equities research analysts have rated the stock with a Buy rating, six have given a Hold rating and two have issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and an average price target of $218.38.

Zscaler Company Profile

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

The company's offerings include Zscaler Internet Access, which secures access to internet and software-as-a-service applications, and Zscaler Private Access, which provides secure, policy-based access to private applications without requiring conventional virtual private networks.

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