5 Best Cybersecurity Stocks to Invest in According to Analysts

2. Zscaler Inc. (NASDAQ:ZS)

Zscaler Inc. (NASDAQ:ZS) is one of the 10 best cybersecurity stocks to invest in according to analysts.

On April 15, Eric Heath from KeyBanc reiterated an Overweight share for Zscaler Inc. (NASDAQ:ZS). However, the analyst significantly reduced the price target from $220 to $160, which still yields an upside of more than 21% at the prevailing level.

The firm highlighted a survey of 36 IT and security channel partners, which indicated mixed views for the first quarter. According to KeyBanc, geopolitical uncertainty, high component costs, and continuous disruption from AI have all contributed to such sentiment. Despite these headwinds, the overall performance indicators really improved. In particular, 88% of respondents met or exceeded expectations, mostly due to early pull-forward demand for networking, server, and storage gear, as well as a marginally improved public cloud forecast.

However, broader budget growth projections for 2026 drastically decreased from 5.3% to 2.5%. Additionally, the analyst has warned that roughly 20% of partners are now actively rerouting traditional software spend toward new AI-native alternatives and noted declining federal sector performance.

On March 18, Zscaler Inc. (NASDAQ:ZS) received Impact Level 5 Provisional Authorization by the Department of War for the company’s Internet Access solution. This constitutes the DoW’s highest-level cloud authorization without any classification. Agencies within the defense industry are now able to utilize a Zero Trust-based architecture for cloud-based solutions in high-risk situations.

With Impact Level 5 authorization, it is possible to decommission existing disjointed security architectures. The authorization allows Zscaler to provide cloud-based solutions within bases, coalition networks, and expeditionary missions as part of its efforts to adopt Zero Trust technologies, which are highly preferred by agencies in the prevalent conditions.

Zscaler Inc. (NASDAQ:ZS) is a cloud security company that provides cyber threat protection products. These include cloud sandbox, cloud browser, data protection, IoT/OT segmentation, security operations products, and more. Additionally, it provides unified vulnerability management, application protection, reduced attack surface, and browser isolation as well. It caters to several industries, including energy, manufacturing, and automotive, to name a few.