Zscaler Coverage Initiated by Stephens & Co. with Overweight Rating

Zscaler receives an Overweight recommendation from Stephens & Co., pointing to a potential 14.85% upside based on analyst price targets. The company is projected to show steady revenue growth of 8.34% and a non-GAAP EPS forecast of 2.64.

Date: 02-04-2025

AI Rating: 8

Earnings Per Share (EPS)
The projected annual non-GAAP EPS for Zscaler stands at 2.64. This metric is crucial as it reflects the company's profitability on a per-share basis after excluding specific costs. A consistent EPS can signal financial health and attract investors.
Revenue Growth
The projected annual revenue for Zscaler is set to be approximately 2,624 million, indicating an increase of 8.34%. This growth in revenue is favorable, suggesting that the company is expanding its market presence and possibly gaining more customers, which is a positive sign for investors.
Impact of Analyst Recommendation
The initiation of coverage by Stephens & Co. with an Overweight rating suggests that analysts expect Zscaler to outperform the market. A forecasted price target of 219.95€/share implies a 14.85% upside from the current trading price of 191.50€/share, serving as an enticing proposition for potential investors.
Institutional Interest
Increased institutional ownership (up 2.29% to 83,474K shares) implies that professional investors have confidence in Zscaler's future performance. This is reinforced by the fact that 1,265 funds or institutions reported holdings, with notable increases from firms like Invesco and Vanguard. Institutional buying can push stock prices higher, reflecting positive sentiment on the stock's prospects.
Concluding Thoughts
Overall, the combination of solid revenue growth, a promising EPS forecast, and an optimistic analyst rating reinforces a bullish sentiment surrounding Zscaler. Given the factors discussed, investors may find Zscaler a certain stock to consider in the near term. However, they'll want to monitor how the company's execution aligns with these forecasts.

Stocks: ZS