UBS analyst Roger Boyd has maintained their bullish stance on ZS stock, giving a Buy rating today.
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Roger Boyd has given his Buy rating due to a combination of factors that highlight Zscaler’s strong performance and growth potential. The company demonstrated impressive organic NNARR growth, estimated to exceed 20%, which surpassed internal expectations and contributed significantly to the annual ARR guidance increase. This momentum is further supported by the addition of 100 new Zero Trust Everywhere customers, showcasing the success of their ZT Branch and ZT Cloud offerings.
Moreover, Zscaler’s data security ARR saw a year-over-year acceleration, reaching approximately $450 million, while AI-security experienced over 80% growth, driven by both Red Canary integration and organic advancements in AIops and Security for AI. The company’s Z-Flex bookings also rose by 70% sequentially, indicating promising early trends. Despite a slight slowdown in non-emerging product ARR growth, the overall outlook remains positive with a projected 10% organic NNARR growth for the remainder of the year. These factors, combined with an attractive valuation at 11x EV/S for 22% year-over-year growth, underpin Boyd’s optimistic Buy rating.
In another report released today, Bank of America Securities also reiterated a Buy rating on the stock with a $335.00 price target.