Zscaler (NASDAQ:ZS) Stock Price Down 4.9% After Analyst Downgrade

Key Points

• Zscaler's stock price decreased by 4.9% following an analyst downgrade from UBS Group, with their price target reduced from $365.00 to $350.00.
• A majority of analysts maintain a "Moderate Buy" consensus rating for Zscaler, while one analyst has issued a "Strong Buy" rating amidst mixed ratings from other brokerages.
• Recent insider transactions included sales by executives totaling over $2 million, suggesting potential concerns about the company's stock performance.

Zscaler, Inc. (NASDAQ:ZS - Get Free Report) shares traded down 4.9% during mid-day trading on Wednesday after UBS Group lowered their price target on the stock from $365.00 to $350.00. UBS Group currently has a buy rating on the stock. Zscaler traded as low as $260.40 and last traded at $261.24. 1,091,061 shares changed hands during trading, a decline of 49% from the average session volume of 2,130,940 shares. The stock had previously closed at $274.57.

A number of other brokerages have also weighed in on ZS. Wall Street Zen lowered Zscaler from a "buy" rating to a "hold" rating in a report on Saturday. Stifel Nicolaus raised their price objective on Zscaler from $295.00 to $330.00 and gave the company a "buy" rating in a report on Wednesday. Robert W. Baird raised their price objective on Zscaler from $330.00 to $345.00 and gave the company an "outperform" rating in a report on Wednesday. JPMorgan Chase & Co. lifted their price target on Zscaler from $292.00 to $348.00 and gave the stock an "overweight" rating in a report on Monday, June 16th. Finally, Evercore ISI lifted their price target on Zscaler from $245.00 to $290.00 and gave the stock an "outperform" rating in a report on Friday, May 30th. One investment analyst has rated the stock with a Strong Buy rating, twenty-nine have issued a Buy rating and seven have assigned a Hold rating to the stock. According to data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $303.60.

Insider Activity

In other news, insider Robert Schlossman sold 3,174 shares of Zscaler stock in a transaction that occurred on Wednesday, June 18th. The stock was sold at an average price of $305.07, for a total value of $968,292.18. Following the completion of the transaction, the insider owned 88,970 shares in the company, valued at approximately $27,142,077.90. This trade represents a 3.44% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, insider Syam Nair sold 4,064 shares of the business's stock in a transaction that occurred on Tuesday, June 17th. The shares were sold at an average price of $303.70, for a total value of $1,234,236.80. Following the transaction, the insider owned 106,659 shares of the company's stock, valued at $32,392,338.30. This represents a 3.67% decrease in their position. The disclosure for this sale can be found here. Insiders have sold 143,305 shares of company stock worth $43,199,936 over the last quarter. Corporate insiders own 18.10% of the company's stock.

Institutional Trading of Zscaler

A number of institutional investors and hedge funds have recently made changes to their positions in ZS. ORG Partners LLC lifted its position in shares of Zscaler by 284.8% in the first quarter. ORG Partners LLC now owns 127 shares of the company's stock worth $26,000 after buying an additional 94 shares during the last quarter. SVB Wealth LLC bought a new stake in shares of Zscaler in the 1st quarter worth about $26,000. Colonial Trust Co SC bought a new stake in shares of Zscaler in the 4th quarter worth about $28,000. Goodman Advisory Group LLC bought a new stake in shares of Zscaler in the 1st quarter worth about $29,000. Finally, N.E.W. Advisory Services LLC bought a new stake in shares of Zscaler in the 1st quarter worth about $29,000. Institutional investors and hedge funds own 46.45% of the company's stock.

Zscaler Trading Down 3.9%

The company's fifty day moving average price is $287.86 and its two-hundred day moving average price is $249.96. The firm has a market cap of $41.07 billion, a P/E ratio of -1,021.45, a price-to-earnings-growth ratio of 259.58 and a beta of 1.05.

Zscaler (NASDAQ:ZS - Get Free Report) last released its quarterly earnings results on Tuesday, September 2nd. The company reported $0.89 earnings per share for the quarter, beating analysts' consensus estimates of $0.80 by $0.09. The firm had revenue of $719.23 million during the quarter, compared to analysts' expectations of $707.15 million. Zscaler had a negative return on equity of 0.59% and a negative net margin of 1.52%.The business's revenue was up 21.3% on a year-over-year basis. During the same period last year, the firm posted $0.88 EPS. Zscaler has set its FY 2026 guidance at 3.640-3.680 EPS. Q1 2026 guidance at 0.850-0.860 EPS. On average, analysts predict that Zscaler, Inc. will post -0.1 EPS for the current fiscal year.

Zscaler Company Profile

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.

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