Zscaler has experienced a sharp decline, down nearly 40% YTD amid broad software sector weakness and AI disruption fears. I reiterate my "Buy" rating on ZS, seeing no fundamental red flags and viewing the selloff as a dollar-cost averaging opportunity. While AI startups may certainly pose a competitive threat to Zscaler, AI should be a net tailwind as Zscaler's AI-driven workloads increase.

Zscaler is upgraded to a "Strong Buy," trading at historically low valuations despite robust growth and mission-critical cybersecurity offerings. ZS posted 26% YoY revenue growth and exceeded guidance, with management guiding for continued high-teens growth and a solid net cash balance sheet. I expect long-term net margins of 30%–35%, driven by operating leverage and AI-driven cost savings, placing ZS at an attractive 20x long-term earnings.

A recent report by JPMorgan Private Bank suggests an influx of investments in cybersecurity is coming. On average, Wall Street analysts expect Zscaler stock to climb by 58% over the next 12 months.

ZS bets big on AI agent security as enterprise adoption surges, leveraging Zero Trust and massive data scale to capture a fast-growing cybersecurity market.

Cybersecurity stocks have lagged during the AI race. Wall Street analysts predict that AI spending for cybersecurity will increase.

Zacks.com users have recently been watching Zscaler (ZS) quite a bit. Thus, it is worth knowing the facts that could determine the stock's prospects.

When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?

The coming rise of agentic AI could be a new wildcard for the rapidly evolving cybersecurity industry.

QSE, FTNT, IONQ, and ZS as the Post-Quantum Transition Reshapes the Global Cybersecurity Landscape Issued on behalf of QSE - Quantum Secure Encryption Corp

Zscaler's stock has declined more than 60% from its all-time high. It still has plenty of room to grow as its cloud-based platform continues to expand.