Zscaler (NASDAQ:ZS) Shares Down 2.7% – Should You Sell?

Shares of Zscaler, Inc. (NASDAQ:ZS) were down 2.7% during trading on Thursday . The stock traded as low as $122.15 and last traded at $123.80. 2,312,053 shares traded hands during mid-day trading, a decline of 37% from the average daily volume of 3,684,192 shares. The stock had previously closed at $127.27.

More Zscaler News

Here are the key news stories impacting Zscaler this week:

• Positive Sentiment: Zscaler CEO Jay Chaudhry said AI is accelerating cybersecurity bug detection and creating a major opportunity for the company’s platform, reinforcing the bullish AI/security narrative around ZS. Zscaler CEO Jay Chaudhry says AI accelerates cybersecurity bug detection
• Positive Sentiment: Zscaler announced a multi-year partnership with Aston Martin Aramco Formula One Team, giving the company another high-profile customer win and showcasing demand for its Zero Trust security tools. Racing Innovation Meets Zero Trust: Aston Martin Aramco Formula One Team and Zscaler Redefine Speed and Security
• Positive Sentiment: Coverage highlighted Zscaler as one of the key beneficiaries of enterprise AI security spending, which may support investor confidence in future growth. Zscaler (ZS) Expands Project AI-Guardian to Provide Unified Security for Enterprise AI Ecosystems
• Neutral Sentiment: Several reports noted that ZS has risen modestly since its last earnings report, reflecting steady post-earnings sentiment rather than a major catalyst. Why Is Zscaler (ZS) Up 0.7% Since Last Earnings Report?
• Neutral Sentiment: Insider Adam Geller sold shares under a pre-arranged 10b5-1 plan; the sale may weigh on sentiment, but it does not necessarily signal a change in outlook. SEC Form 4 Filing
• Negative Sentiment: Pomerantz LLP launched an investor investigation into Zscaler, adding legal overhang that could pressure the stock. INVESTOR ALERT: Pomerantz Law Firm Investigates Claims On Behalf of Investors of Zscaler, Inc. – ZS

Wall Street Analysts Forecast Growth

ZS has been the topic of several analyst reports. Mizuho lowered their target price on Zscaler from $210.00 to $185.00 and set an “outperform” rating on the stock in a research note on Wednesday, May 27th. Oppenheimer lowered their target price on Zscaler from $280.00 to $250.00 and set an “outperform” rating on the stock in a report on Tuesday, March 10th. Robert W. Baird decreased their price objective on Zscaler from $265.00 to $230.00 and set an “outperform” rating on the stock in a research note on Wednesday, May 27th. Truist Financial set a $210.00 target price on Zscaler in a research report on Wednesday, May 27th. Finally, Wells Fargo & Company dropped their target price on shares of Zscaler from $210.00 to $180.00 and set an “overweight” rating for the company in a research report on Thursday, May 28th. Thirty-four equities research analysts have rated the stock with a Buy rating, six have given a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the stock has an average rating of “Moderate Buy” and an average target price of $213.97.

Zscaler Trading Down 2.7%

The firm has a 50 day moving average price of $141.54 and a two-hundred day moving average price of $170.03. The firm has a market capitalization of $20.02 billion, a P/E ratio of -257.91, a price-to-earnings-growth ratio of 78.89 and a beta of 0.97. The company has a debt-to-equity ratio of 0.72, a quick ratio of 1.86 and a current ratio of 1.86.

Zscaler (NASDAQ:ZS) last released its earnings results on Tuesday, May 26th. The company reported $1.08 earnings per share for the quarter, beating the consensus estimate of $1.01 by $0.07. The company had revenue of $850.48 million for the quarter, compared to analysts’ expectations of $835.14 million. Zscaler had a negative return on equity of 0.37% and a negative net margin of 2.44%.The business’s revenue for the quarter was up 25.4% on a year-over-year basis. During the same quarter in the previous year, the business posted $0.84 EPS. Zscaler has set its Q4 2026 guidance at 1.080-1.090 EPS and its FY 2026 guidance at 4.100-4.110 EPS. On average, equities research analysts expect that Zscaler, Inc. will post 0.11 EPS for the current fiscal year.

Insider Buying and Selling at Zscaler

In other news, CFO Kevin Rubin sold 1,686 shares of the stock in a transaction that occurred on Tuesday, June 16th. The stock was sold at an average price of $126.43, for a total value of $213,160.98. Following the completion of the transaction, the chief financial officer directly owned 44,901 shares of the company’s stock, valued at approximately $5,676,833.43. This represents a 3.62% decrease in their position. The sale was disclosed in a filing with the SEC, 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 Singh Chaudhry sold 2,878 shares of Zscaler stock in a transaction on Tuesday, June 16th. The shares were sold at an average price of $126.43, for a total value of $363,865.54. Following the completion of the transaction, the chief executive officer owned 343,038 shares of the company’s stock, valued at approximately $43,370,294.34. The trade was a 0.83% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last quarter, insiders sold 12,644 shares of company stock worth $1,587,627. Corporate insiders own 17.20% of the company’s stock.

Institutional Trading of Zscaler

A number of hedge funds have recently modified their holdings of ZS. Groupama Asset Managment lifted its holdings in Zscaler by 76,352.6% during the third quarter. Groupama Asset Managment now owns 4,750,000 shares of the company’s stock worth $1,423,385,000 after acquiring an additional 4,743,787 shares in the last quarter. First Trust Advisors LP grew its position in shares of Zscaler by 36.2% in the 1st quarter. First Trust Advisors LP now owns 3,518,678 shares of the company’s stock valued at $493,635,000 after purchasing an additional 935,781 shares during the period. Price T Rowe Associates Inc. MD grew its position in shares of Zscaler by 43.3% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 2,572,358 shares of the company’s stock valued at $578,576,000 after purchasing an additional 777,414 shares during the period. AQR Capital Management LLC lifted its stake in Zscaler by 61.8% in the third quarter. AQR Capital Management LLC now owns 1,941,571 shares of the company’s stock valued at $576,083,000 after buying an additional 741,756 shares in the last quarter. Finally, Pictet Asset Management Holding SA boosted its holdings in shares of Zscaler by 52.5% in the first quarter. Pictet Asset Management Holding SA now owns 1,920,540 shares of the company’s stock valued at $269,285,000 after buying an additional 661,413 shares during the period. 46.45% of the stock is currently owned by institutional investors and hedge funds.

About Zscaler

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.