5 Best Cloud Computing Stocks To Buy In 2026

Page 5 of 5

1. Zscaler Inc (NASDAQ:ZS)

Potential Upside: 53.8%

On May 1, Citizens analyst Trevor Walsh lowered his price target on Zscaler Inc. (NASDAQ:ZS) stock from $290 to $210 while keeping the Outperform rating. Heading into Q1 earnings, the firm revised its financial models in light of upcoming industry data. The demand for zero-trust and SASE (Secure Access Service Edge) solutions continues to be high. However, concerns about cybersecurity risks stemming from advanced AI models have led to a re-rating of the sector, according to the analyst.

The valuation revision isn’t the only factor driving the stock’s price down. While Trevor Walsh cites the strong SASE demand as a bullish factor, JPMorgan on April 21 cited competition in the same to lower the stock’s price target from $200 to $155, suggesting the firm is even more bearish on the stock than Citizens. JPMorgan’s Meta Marshall also added that the firm’s original bull thesis on the stock revolved around platform expansion, which it does not see materializing anymore.

Zscaler Inc (NASDAQ:ZS) is a provider of cloud security through products and solutions such as the Zero Trust Firewall, Cloud Sandbox, Zero Trust Browser, and Zscaler Internet Access. The company was incorporated in 2007 and is based in San Jose, California.

While we acknowledge the potential of ZS to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ZS and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 10 Stocks That Will Collapse Because of AI and 10 Best Stocks To Buy Before SpaceX IPO.

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.

Page 5 of 5