Barclays cuts Zscaler target but ‘defending the stock’

Barclays lowered the firm’s price target on Zscaler to $200 from $230 and keeps an Overweight rating on the shares. The company’s fiscal Q4 results were strong but the fiscal 2025 billings growth is slower in the first half of the year with a bigger second half ramp than expected, the analyst tells investors in a research note. The firm, however, is “defending the stock.” It thinks this is more mechanical than fundamental as Zscaler’s billings cohorts from the first half of 2024 experienced more macro pressure. Barclays still likes the company’s secular growth and expanding free cash flow margins.