Zscaler (NASDAQ:ZS) Downgraded to "Hold" Rating by Wall Street Zen

Key Points

• Zscaler has been downgraded from a "buy" to a "hold" rating by Wall Street Zen, amidst mixed analyst opinions regarding its stock performance.
• The company reported quarterly earnings that exceeded analyst expectations, with revenue increasing by 22.6% year-over-year, reaching $678.03 million.
• Insiders have recently sold shares totaling over $50 million, signaling potential concerns about the stock's performance among company executives.

Zscaler (NASDAQ:ZS - Get Free Report) was downgraded by stock analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a report issued on Saturday.

Several other equities analysts have also recently issued reports on ZS. Evercore ISI upped their price target on shares of Zscaler from $245.00 to $290.00 and gave the company an "outperform" rating in a research report on Friday, May 30th. Oppenheimer boosted their price target on shares of Zscaler from $290.00 to $345.00 and gave the stock an "outperform" rating in a research report on Friday, June 6th. Stifel Nicolaus boosted their price target on shares of Zscaler from $270.00 to $295.00 and gave the stock a "buy" rating in a research report on Friday, May 30th. Canaccord Genuity Group set a $305.00 price target on shares of Zscaler and gave the stock a "buy" rating in a research report on Monday, June 2nd. Finally, B. Riley initiated coverage on shares of Zscaler in a research report on Tuesday, August 26th. They issued a "neutral" rating and a $275.00 price target on the stock. One equities research analyst has rated the stock with a Strong Buy rating, twenty-nine have issued a Buy rating and seven have issued a Hold rating to the company's stock. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average target price of $297.63.

Zscaler Stock Down 0.9%

NASDAQ ZS traded down $2.48 on Friday, hitting $274.57. The company's stock had a trading volume of 5,396,423 shares, compared to its average volume of 2,140,370. Zscaler has a 1-year low of $153.45 and a 1-year high of $318.46. The company's 50-day moving average is $288.53 and its 200 day moving average is $249.79. The firm has a market cap of $42.75 billion, a PE ratio of -1,056.04, a PEG ratio of 259.58 and a beta of 1.05.

Zscaler (NASDAQ:ZS - Get Free Report) last announced its quarterly earnings results on Tuesday, September 2nd. The company reported ($0.04) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.80 by ($0.84). Zscaler had a negative net margin of 1.52% and a negative return on equity of 0.59%. Zscaler has set its FY 2026 guidance at 3.640-3.680 EPS. Q1 2026 guidance at 0.850-0.860 EPS. On average, equities analysts expect that Zscaler will post -0.1 EPS for the current year.

Insider Activity at Zscaler

In other news, Director Andrew William Fraser Brown sold 20,333 shares of the company's stock in a transaction that occurred on Wednesday, June 4th. The stock was sold at an average price of $296.72, for a total transaction of $6,033,207.76. Following the transaction, the director directly owned 27,216 shares of the company's stock, valued at $8,075,531.52. This represents a 42.76% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, insider Adam Geller sold 3,662 shares of the company's stock in a transaction that occurred on Wednesday, June 18th. The stock was sold at an average price of $306.72, for a total value of $1,123,208.64. Following the transaction, the insider directly owned 46,813 shares in the company, valued at $14,358,483.36. The trade was a 7.26% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 168,256 shares of company stock valued at $50,618,544 over the last three months. 18.10% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Zscaler

Institutional investors have recently modified their holdings of the company. GAMMA Investing LLC raised its position in shares of Zscaler by 43.1% during the first quarter. GAMMA Investing LLC now owns 641 shares of the company's stock worth $127,000 after purchasing an additional 193 shares during the period. Allworth Financial LP boosted its position in shares of Zscaler by 47.4% during the first quarter. Allworth Financial LP now owns 1,002 shares of the company's stock valued at $211,000 after buying an additional 322 shares during the last quarter. Krane Funds Advisors LLC boosted its position in shares of Zscaler by 36.4% during the first quarter. Krane Funds Advisors LLC now owns 1,667 shares of the company's stock valued at $331,000 after buying an additional 445 shares during the last quarter. Merit Financial Group LLC boosted its position in shares of Zscaler by 42.0% during the first quarter. Merit Financial Group LLC now owns 6,197 shares of the company's stock valued at $1,230,000 after buying an additional 1,832 shares during the last quarter. Finally, National Pension Service boosted its position in shares of Zscaler by 11.2% during the first quarter. National Pension Service now owns 171,847 shares of the company's stock valued at $34,098,000 after buying an additional 17,342 shares during the last quarter. 46.45% of the stock is owned by institutional investors and hedge funds.

About Zscaler

Zscaler, Inc operates as a cloud security company worldwide. The company offers Zscaler Internet Access solution that provides users, workloads, IoT, and OT devices secure access to externally managed applications, including software-as-a-service (SaaS) applications and internet destinations; and Zscaler Private Access solution, which is designed to provide access to managed applications hosted internally in data centers, and private or public clouds.