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Added to YB: 2026-03-03

Pitch date: 2026-02-27

ZS [bullish]

Zscaler, Inc.

+50.78%

current return

Author Info

No bio for this author

Company Info

Zscaler, Inc. operates as a cloud security company worldwide. The company offers cyberthreat protection products, including Zero Trust SASE, a solution that securely connects workforces, AI agents, workloads, and IoT/OT devices to cloud apps and AI services; Zscaler Internet Access, which provides advanced threat protection, sandbox, and zero trust firewall; Zscaler Private Access solution that includes cyberthreat and data protection, application discovery, secure application access, application segmentation, application protection, and reduced attack surface; Zero Trust Browser, a solution that secures browser-based access to business applications for the extended workforce, including third parties and partners; Zscaler Digital Experience, a solution that monitors end-user experience and helps organizations identify and resolve performance issues across their digital environment; Zero Trust Branch; and Zero Trust Cloud solutions.

Market Cap

$38.1B

Pitch Price

$146.19

Price Target

213.00 (-3%)

Dividend

N/A

EV/EBITDA

215.98

P/E

-592.73

EV/Sales

10.89

Sector

Software

Category

growth

Show full summary:
Zscaler 2QFY26 Earnings: The Penalty Box and the Pattern

ZS (earnings): Q2 rev +26% (best in 2yrs), Rule of 62, all metrics beat but stock -10% on organic guide math (Red Canary +$35M vs total raise +$24M). Z-Flex TCV $290M (+66% seq), 30%+ of RPO, avg 4yr deals w/ 3x spend expansion. Non-seat consumption rev (ZTB, ZTC, AI) 25%+ of new ACV, +100% YoY, scales w/ traffic not headcount. Core ZIA/ZPA mid-teens growth on $2B base. AI agent traffic (MCP requests) ramping. $876M FY26 FCF at 7x NTM rev vs peers 10-15x. Bear: growth to high-teens, 5x = $125. Base: 8x = $192. Bull: consumption scales, 12x = $288. Risks: enforcement layer migrating to endpoint/browser vs cloud proxy, Microsoft Entra competition, growth <20%, Z-Flex stalling, gross margin compression.

Read full article (8 min)