In a report released today, Meta Marshall from Morgan Stanley upgraded Zscaler to a Buy, with a price target of $320.00.
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Meta Marshall has given his Buy rating due to a combination of factors that highlight Zscaler’s strategic positioning and growth potential. One of the key reasons is Zscaler’s strong presence in the zero-trust network access market, which is crucial for the secure access service edge (SASE) approach. This approach is gaining traction as organizations seek consistent security policies across hybrid environments, and with a significant share in this market, Zscaler is well-positioned to capitalize on the increasing adoption of SASE.
Additionally, Zscaler’s recent acquisition of Red Canary enhances its AI security capabilities, allowing it to enter the growing managed detection and response (MDR) market. This acquisition is expected to strengthen Zscaler’s platform and improve its AI positioning. Despite a substantial year-to-date increase in valuation, Zscaler’s growth-adjusted multiple suggests there is still potential for upside, especially if the company continues to outperform in growth and margins compared to its peers.
In another report released yesterday, Robert W. Baird also maintained a Buy rating on the stock with a $330.00 price target.
Based on the recent corporate insider activity of 51 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of ZS in relation to earlier this year.