ZS Should I Buy
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Zscaler Inc (ZS) is not a strong buy at the moment for a beginner investor with a long-term strategy. Despite solid revenue growth and positive developments in its AI Protect suite, the stock is currently in a bearish technical trend, with significant insider selling and no strong proprietary trading signals. The recent price drop may present a better entry point in the future, but for now, holding off on buying is recommended.
The technical indicators for ZS are bearish. The MACD is negatively expanding (-0.83), the RSI is oversold at 15.431, and the moving averages indicate a downtrend (SMA_200 > SMA_20 > SMA_5). The stock is trading below key support levels, with the next support at S2: 126.628.
Zscaler's AI Protect suite has driven a 26% YoY revenue increase.
Partnerships like P0 Security enhance its Zero Trust security model.
Analysts highlight Zscaler's competitive positioning and expanding platform adoption.
The stock has dropped over 36% in 2026, reflecting broader market challenges and investor sentiment.
Insiders are selling heavily, with a 1511.18% increase in selling over the last month.
The broader market (S&P
is also down (-0.84%), adding to bearish sentiment.
In Q2 2026, Zscaler reported a 25.91% YoY revenue increase to $815.8M. Net income improved significantly, up 344.23% YoY to -$34.31M, and EPS increased by 320% to -0.21. However, gross margin slightly declined to 76.55% (-0.69% YoY).
Analysts generally maintain positive ratings, with most keeping Buy or Outperform ratings. Price targets have been revised downward (e.g., Oppenheimer to $250 from $280, Citi to $195 from $305) due to broader market conditions but still reflect long-term growth potential.
