Zscaler, Inc.

Zscaler, Inc.

ZSยทNASDAQ

$134.37

-14%
TechnologySoftware - Infrastructure

Zscaler, Inc. operates as a cloud security company worldwide. The company provides Zscaler Internet Access solution that provides users, servers, operational technology, Internet of Things device secure access to externally managed applications, including software-as-a-service (SaaS) applications and Internet destinations; and Zscaler Private Access solution, which is designed to provide access to managed applications hosted internally in data centers, and private or public clouds. It also offers Zscaler Digital Experience that measures end-to-end user experience across business applications, as well as provides an easy to understand digital experience score for each user, application, and location within an enterprise. In addition, the company provides workload segmentation solutions comprising Zscaler Cloud Security Posture Management that identifies and remediates application misconfigurations in SaaS, infrastructure as a service, and platform as a service to reduce risk and ensure compliance with industry and organizational benchmarks; and Zscaler Cloud Workload Segmentation, which is designed to secure application-to-application communications inside public clouds and data centers to stop lateral threat movement, as well as prevents application compromise and reduces the risk of data breaches. Its platform modules include Zscaler Central Authority, Zscaler Enforcement Node, and Zscaler Log Servers. It serves customers in airlines and transportation, conglomerates, consumer goods and retail, financial services, healthcare, manufacturing, media and communications, public sector and education, technology, and telecommunications services industries. The company was formerly known as SafeChannel, Inc., and changed its name to Zscaler, Inc. in August 2008. Zscaler, Inc. was incorporated in 2007 and is headquartered in San Jose, California.

At a Glance

Live Snapshot
Market Cap$21.73B
EPS-0.2700
P/E Ratio-497.67
Earnings Date06/04/2026

Intrinsic Alpha Methodology

Thesis Lenses

Signal ยท Driver ยท Risk

Signal

Medium confidence

Valuation multiple is compressed (P/E -497.7).

Valuation inputs: P/E -497.7, earnings yield N/A, momentum -13.7%.

If multiples stay elevated while momentum fades, downside repricing risk rises.

Driver

High confidence

Return profile is soft (ROE -2.3%, ROIC -3.2%).

Profitability stack: net margin -1.6%, ROE -2.3%, ROIC -3.2%.

Quality deterioration often appears in margins before it shows up in headline EPS.

Risk

High confidence

Downside profile is elevated and scenario stress-testing is essential.

Risk factors: liabilities/assets +72.0%, momentum -13.7%, net margin -1.6%.

Higher leverage with weak momentum and thin margins can amplify drawdown severity.

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Zscaler, Inc. Market vs Earnings Trajectory

ZS ยท NASDAQ

Loading price and EPS data...

Zscaler, Inc.

Zscaler, Inc. Fair Value Envelope

ZS ยท NASDAQ

Our analysis suggests that ZS has a fair value of HIDDEN per share in the Base Case projection. With shares currently trading at $134.37, this represents a potential HIDDEN relative to our calculated worth for Zscaler, Inc..

Intrinsic Value
Current Price: $134.37
3Y-90.0%
5Y-70.0%
10Y-72.0%
3Y+145.0%
5Y+520.0%
10Y+3228.0%
3Y-89.0%
5Y-64.0%
10Y+51.0%
3Y+202.0%
5Y+1126.0%
10Y-8261.0%
3Y+214.0%
5Y+2542.0%
10Y-4101.0%
3Y+127.0%
5Y+250.0%
10Y+4082.0%
Zscaler, Inc.

Zscaler, Inc. Profit Bridge

ZS ยท NASDAQ
Revenue2.67B
Cost of Goods Sold (618.18M)
Gross Profit2.05B
Operating Expenses (2.18B)
Operating Income-128.46M
Interest Expense (9.52M)
Other Income/Expense110.17M
Pretax Income-18.29M
Income Tax (23.19M)
Net Income-41.48M
Net Income
-41.48M

Profitability Analysis

Gross Margin

76.9%

Exceptional pricing power and cost management. The company retains over half of revenue after direct costs.

Operating Margin

-4.8%

Operating losses indicate the core business is unprofitable. Requires restructuring or revenue growth.

Net Profit Margin

-1.6%

Net losses indicate the company is burning cash. Sustainability depends on path to profitability.

Profitability Insight

Margin squeeze alert: Healthy gross margins but weak operating margins suggest excessive operating expenses. Cost optimization could unlock significant value.

76.87%
Gross Profit Margin
-1%
3Y-1.0%
5Y-1.0%
10Y+3.0%
-4.81%
Operating Profit Margin
-16%
3Y-84.0%
5Y-78.0%
10Y-86.0%
-1.55%
Net Profit Margin
-42%
3Y-96.0%
5Y-94.0%
10Y-95.0%
-2.31%
Return on Equity
-49%
3Y-97.0%
5Y-90.0%
10Y-94.0%
-0.65%
Return on Assets
-47%
3Y-95.0%
5Y-90.0%
10Y-96.0%
-3.18%
Return on Invested Capital
-29%
3Y-83.0%
5Y-53.0%
10Y-91.0%
ZS

Zscaler, Inc. Cash Conversion Engine

ZS ยท NASDAQ
Net Income-41.48M
Depreciation & Amortization121.18M
Stock-Based Compensation661.35M
Change in Working Capital26.72M
Others219.03M
Capital Expenditures-245.76M
Free Cash Flow726.69M

Cash Flow Quality Analysis

FCF Conversion Rate

-1752.0%

Negative free cash flow despite positive earnings raises concerns about cash generation ability or heavy capital requirements.

CapEx Intensity

25.3%

Moderate capital requirements typical of many stable businesses. Healthy balance between reinvestment and cash generation.

FCF Growth Trend

+24.2%

Strong FCF growth demonstrates improving cash generation and business momentum. Positive signal for sustainability.

Working Capital Impact

+$26.72M

Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.

zs

Zscaler, Inc. Funding & Solvency Profile

ZS ยท NASDAQ
Cash & Cash Equivalents982.11M
Net Receivables730.46M
Inventory0.00
Other Current Assets384.62M
Total Current Assets5 B
Property, Plant & Equipment712.92M
Goodwill & Intangible Assets1.29B
Long-Term Investments0.00
Other Non-Current Assets444.80M
Total Non-Current Assets1 B
Total Assets
7.10B

Financial Health Analysis

Current Ratio

1.86x

Strong liquidity. The company has adequate resources to meet short-term liabilities.

Debt-to-Equity Ratio

2.00x

Elevated leverage. Debt exceeds equity, which amplifies both gains and risks. Monitor debt servicing ability.

Working Capital

2 B

Strong working capital position provides significant operational flexibility and financial cushion.

Asset Composition

66% Current

Asset-light business model with high liquidity. Majority of assets are easily convertible to cash.

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Zscaler, Inc. Street Expectations Map

ZS ยท NASDAQ

Wall Street analysts project that ZS stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 199.77, with estimates ranging from a low of 145.00 to a high of 320.00.

Lowest Target
145.00
7.91%
Consensus Target
199.77
48.67%
Highest Target
320.00
138.15%

The consensus 1-year price target stands at 199.77, with estimates ranging from a low of 145.00 to a high of 320.00.

Analyst Consensus Analysis

Upside Potential

+48.7%

Substantial upside potential. Analysts see significant value gap, suggesting the stock may be materially undervalued at current levels.

Analyst Agreement

87.6% spread

High uncertainty. Very wide target spread indicates significant disagreement among analystsโ€”major valuation uncertainty or transformation underway.

Analyst Conviction

Low

High uncertainty: Wide dispersion indicates analysts struggle to agree on valuationโ€”proceed with caution and independent analysis.

Market Sentiment Insight

High risk, high reward: Substantial upside potential exists, but wide analyst disagreement signals execution risk or unclear catalysts. Thorough due diligence essential before committing capital.

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Zscaler, Inc. Insider Positioning

ZS ยท NASDAQ

During the last 12 months, insiders have sold $38.05M worth of ZS shares, with no buying activity reported.

3 Months

Bought

0

0.00

Sold

15.3K

2.39M

Net Activity

-2.4M

-$2.39M

3-6 Months

Bought

0

0.00

Sold

23.4K

5.42M

Net Activity

-5.4M

-$5.42M

6-9 Months

Bought

0

0.00

Sold

40.9K

11.66M

Net Activity

-11.7M

-$11.66M

9-12 Months

Bought

0

0.00

Sold

61.8K

18.59M

Net Activity

-18.6M

-$18.59M

Top Buyers

No buying activity

Top Sellers

1
RMJ

Rich Michael J.

Officer: Cro And President Of Ww Sales

33.2K sharesโ€ข5 transactions

$9.06M

2
SR

Schlossman Robert

Officer: Chief Legal Officer

23.8K sharesโ€ข9 transactions

$6.47M

3
GA

Geller Adam

Officer: Chief Product Officer

24.8K sharesโ€ข8 transactions

$6.42M

4
BAWF

Brown Andrew William Fraser

Director

19.9K sharesโ€ข1 transactions

$5.92M

5
JR

Judge Raj

Director, Officer: Evp, Corp. Strategy & Ventures

13.4K sharesโ€ข4 transactions

$3.35M

Insider Activity Analysis

Net Insider Sentiment

Bearish

Strong bearish signal with $38.05M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.

Buy/Sell Ratio

0.00:1

Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.

Recent Trend (3 Months)

$2.39M

Heavy recent selling activity. Recent insider sales notably exceed purchasesโ€”may warrant investigation into company developments.

Insider Participation

High Selling

5 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.

Insider Activity Insight

Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.

No Dividend Yield Data

ZS has not reported any dividend yield values in the available annual periods.

ย 

zs Dividend History

ZS
10Y CAGR +0%
Latest $0
Annual $0
Stable dividend payments
Last Period: +0%