Zscaler (ZS) Hits 52-Week Low Amid Analyst Downgrades, Cybersecurity Stock Under Pressure
Zscaler Inc. (ZS) plunged to a 52-week low of $162.85 on February 20, extending a brutal six-month decline of 38% and a 25% year-to-date drop. The cybersecurity firm, once a market darling, now faces a wave of analyst price target cuts despite maintaining robust fundamentals.
JP Morgan retained its Overweight rating but slashed its target by 24.6% to $267, joining Keybanc, Mizuho, and Truist in a broader reassessment of valuation. Revenue growth remains strong at 23% YoY with 77% gross margins, suggesting the selloff reflects compressed multiples rather than operational weakness.
Notably, 28 analysts have raised earnings estimates concurrently with price target reductions. The disconnect creates a striking valuation gap—the average $306.99 price target implies 89% upside from current levels, with InvestingPro models flagging the stock as fundamentally undervalued.
