Why Zscaler Stock Absolutely Crushed the Market This Thursday

Zscaler just schooled the entire tech sector—and Wall Street's scrambling to catch up.

Security's Back in Vogue

Cloud security isn't just trending—it's printing money. While traditional security plays stumble, Zscaler's zero-trust architecture keeps delivering where others fail. No legacy baggage, no on-premise limitations—just pure cloud-native performance that institutional investors can't ignore.

The Numbers Don't Lie

Revenue growth? Accelerating. Market share? Expanding. Short interest? Getting vaporized. This isn't some speculative crypto pump—it's fundamental dominance playing out in real-time. The stock's momentum suggests institutions are finally understanding what tech insiders knew years ago: perimeter security is dead.

Wall Street's Late to the Party—Again

Analysts spent months questioning the valuation while smart money accumulated positions. Now they're racing to upgrade price targets—classic reactionary behavior from an industry that still thinks firewalls are cutting-edge. Meanwhile, Zscaler keeps eating their lunch by actually solving modern security problems.

Freedom to upgrade

That change in recommendation came from Freedom Capital Markets pundit Almas Almaganbetov, who upped his rating to buy from the previous hold. With the move, Almaganbetov also confidently raised his price target on Zscaler by 14%, resetting it to $320 per share for the specialty tech company.

Image source: Getty Images.

The analyst's modifications are largely due to the company's performance in its fiscal fourth quarter, the results of which were published last week. According to reports, Almaganbetov wrote admiringly of the company's performance -- revenue ROSE 21% year over year for the period, while annual recurring revenue (ARR) clocked a 22% gain, and calculated billings advanced by 32%.

The pundit believes this illustrates the strong and resilient demand for Zscaler's wares. He was also encouraged by the fact that such growth was broad-based across Zscaler's suite of product offerings, including its relatively new artificial intelligence (AI)-enhanced solutions.

Knee-jerk reaction

It should be noted that not everyone was as impressed with Zscaler's quarter. In fact, investors as a group sold out of its stock in the immediate post-earnings trading session; what didn't help was the company's surprise net loss -- on average, analysts were expecting Zscaler to land well in the black. Since then, however, the share price has generally been on an upward trend.