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Investing.com - Stifel raised its price target on Zscaler (NASDAQ:ZS) to $330.00 from $295.00 on Wednesday, maintaining a Buy rating following the cybersecurity firm’s strong fiscal fourth-quarter performance. According to InvestingPro data, Zscaler, currently valued at $43.14 billion, appears to be trading above its Fair Value.
The research firm highlighted Zscaler’s quarterly metrics exceeded expectations, driven by strong execution and continued demand for the company’s expanding Zero-Trust portfolio. With impressive gross margins of 77.46% and revenue growth of 25.46% over the last twelve months, Stifel was particularly impressed with Zscaler’s 32% year-over-year billings growth and 31% RPO (remaining performance obligation) growth, which accelerated for the fourth consecutive quarter.
For fiscal year 2026, Zscaler introduced ARR (annual recurring revenue) as a new metric, projecting 22-23% year-over-year growth. This guidance aligned with or exceeded market expectations and significantly surpassed bearish forecasts of 19% growth. InvestingPro subscribers can access 10+ additional key insights and detailed financial metrics to better evaluate Zscaler’s growth trajectory.
Stifel expressed confidence in Zscaler’s momentum across emerging areas including Zero Trust Everywhere, Data Security Everywhere, and AI Security, as well as newer initiatives like Z-Flex and firewall replacement solutions.
The firm believes Zscaler’s product portfolio helps organizations improve security posture, drive vendor consolidation, and reduce costs, while demonstrating success through expanded product adoption, improved go-to-market productivity, and opportunities in AI security.
In other recent news, Zscaler reported its fourth-quarter results, which presented a mixed picture for investors. The company experienced a significant earnings per share (EPS) miss, posting -$0.11 compared to the forecasted $0.80. However, revenue exceeded expectations, reaching $719 million against the anticipated $706.95 million. Analysts have responded to these results with varying outlooks. Evercore ISI raised its price target for Zscaler to $320, maintaining an Outperform rating, highlighting the company’s robust fiscal year 2026 guidance and revenue growth projections. Similarly, Barclays increased its price target to $320, citing strong Annual Recurring Revenue (ARR) growth and potential future gains. BTIG reiterated its Buy rating with a $365 price target, noting Zscaler’s billings of $1,202 million, which surpassed both their own and market estimates. Zscaler’s recent acquisition of Red Canary is expected to contribute approximately $90 million to its revenue growth. These developments reflect a complex but optimistic outlook for Zscaler among analysts.
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