In a report released today, Shaul Eyal from TD Cowen reiterated a Buy rating on Zscaler (ZS – Research Report), with a price target of $270.00.
Shaul Eyal has given his Buy rating due to a combination of factors that highlight Zscaler’s strong financial performance and strategic positioning. The company reported impressive results for the second quarter of fiscal year 2025, with a 23% year-over-year increase in revenue, surpassing market expectations. Additionally, Zscaler’s annual recurring revenue (ARR) grew by 23% to $2.7 billion, and its remaining performance obligations (RPO) increased by 28% year-over-year, indicating robust future revenue streams.
Another key factor influencing the Buy rating is Zscaler’s successful expansion in emerging product areas, which are growing at more than twice the rate of its core offerings. The company’s focus on Zero Trust solutions and AI-powered capabilities is driving enterprise adoption and enhancing its competitive edge. Furthermore, Zscaler’s strategic initiatives in the federal sector and its ability to secure large transactions with major clients underscore its potential for sustained growth. These elements, combined with improved sales productivity and a positive outlook for the second half of fiscal year 2025, reinforce the Buy recommendation.
In another report released today, Bernstein also maintained a Buy rating on the stock with a $244.00 price target.