BMO Capital analyst Keith Bachman raised the firm’s price target on Zscaler (ZS) to $315 from $295 and keeps an Outperform rating on the shares after its Q4 results. Based on guidance, the organic net new annual recurring revenue, ARR, is expected to grow by approximately 7% y/y, which seems conservative, with net new ARR grew by 16% y/y in the July quarter, the analyst tells investors in a research note. BMO adds that the security market is less likely to be subject to AI dislocation vs. other areas of software, and the firm sees Zscaler as one of its “favorite names in the sector”.
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