Zscaler Stock Price Forecast: $360 Target in Sight⁤ by 2026?

⁢ ‍ updated June 02, 2025
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Zscaler Inc. (ZS) is drawing increased attention from analysts, with projections suggesting its share price coudl reach $360. This optimistic outlook is‍ fueled by technical price action,favorable analyst sentiment,and⁣ strong fiscal results. Recent market behavior indicates a breakout to new highs, confirming an uptrend and signaling the end of a long-term trading range.

The previous trading range reflected concerns about valuation and potential slowing growth. However, improved business fundamentals are now aligning with the valuation, leading to a more positive outlook. Analysts anticipate enduring growth around 20%, healthy free⁤ cash flow, and increasing shareholder value.

Technical analysis suggests the $360 target could be achieved by ⁤late ‍this year or early 2026. The target is based on the magnitude of the ⁢previous trading range. The stock’s robust breakout ‍to⁢ new highs,coupled with solid support⁢ levels,supports ⁢a bullish scenario. ⁣some projections even place the market in⁣ the⁤ $375 to $403 range, potentially leading to new all-time highs.

Analyst Sentiment Shifts After Strong Q3

Analyst ⁤activity surrounding Zscaler had been subdued for over a year. However, the‍ company’s fiscal Q3 results ⁣sparked a significant shift in attitude. MarketBeat reported 24 revisions from the 36 analysts it tracks, with more increases than decreases in price‍ targets.

Notably, no decreases were recorded. This resulted in a 17% increase in the consensus price target ⁤within days of the earnings release, a 25% increase year-over-year. While the consensus suggests fair ⁤value is near ⁢current levels, the high-end range adds another ⁢15%.

Analysts highlight that Zscaler’s solid Q3⁤ performance occurred despite macroeconomic uncertainties that negatively impacted competitors. The company’s strength is expected to continue into Q4, providing momentum into the⁤ next fiscal year.New products, notably ⁢Z-Flex, ‍are expected to contribute ⁤to this ongoing momentum.

The strength in Q3 is expected to carry over into⁤ Q4, leaving the company with momentum heading into the ⁢next ⁢fiscal year. New products help the platform carry momentum, and ⁤the new Z-flex is expected to do the same.

Z-Flex is a new purchasing model designed to help businesses streamline adjustments to their security infrastructure,⁢ reducing costs while enhancing⁤ flexibility and scalability.

Solid Q3 Performance Despite Growth Slowdown

While Zscaler’s growth slowed to the low 20% range in Q3,revenue still exceeded analysts’ forecasts. The company maintained growth above 20% for another quarter, further supported by accelerated⁣ gains in billings and‍ deferred revenue.

Othre key metrics include a 21% increase in net ⁤income, an 18% free cash flow margin, and a 25% increase in cash reserves. ⁢Zscaler currently holds over $3 billion in cash and equivalents, with equity up 41% year-to-date in fiscal year 2025.

The company’s guidance aligns with analysts’ consensus forecasts, suggesting that the strength observed in Q3 will persist throughout the full year.⁣ This guidance may even be conservative.

Institutional investors currently own a substantial 41%‍ of Zscaler’s stock and have been net buyers throughout the year,providing a solid support base. ⁤Short-covering activity is further amplifying the positive price action.

What’s next

Looking ahead, Zscaler’s⁣ ability⁤ to maintain its growth trajectory and capitalize on the Z-Flex purchasing model will be crucial in⁣ achieving the projected $360 stock price target. Upcoming earnings reports and analyst⁢ revisions will provide further insights into the company’s performance and potential.