JP Morgan Boosts Zscaler’s (ZS) Price Target to $292, Maintains Buy Rating

On May 30, JP Morgan’s Brian Essex reiterated his Buy rating on Zscaler Inc. (NASDAQ:ZS) and raised the stock’s price target from $275 to $292. He cited the stronger-than-expected financial and operational performance in Q3 2025 results, reported on May 29, as a basis for his optimistic view.

Zscaler is a U.S.-based cloud security company that offers cloud-based services to protect enterprise networks and data. In his latest note, Essex pointed to Zscaler’s strong performance across key metrics, including revenue, billings, profitability, and free cash flow, which the analyst believes is supported by robust traction in newer product categories and a notable uptick in new customer additions.

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In light of this performance, Zscaler raised its full-year guidance across all these major metrics. Management now anticipates year-over-year revenue growth of 23 %, EPS in the range of $3.18 to $3.19, and a free cash flow margin between 25.5% and 26.0%. This compares favorably to the company’s previous guidance of 22% revenue growth, EPS between $3.04 and $3.09, and a free cash flow margin of 24.5% to 25.0%.

The analyst further highlighted the company’s robust progress toward its annual recurring revenue (ARR) targets, which are supported by an expanding base of large enterprise customers. He believes the company’s recent acquisition of Red Canary will support growth, enhance Zscaler’s platform capabilities, and strengthen its competitive positioning in the cybersecurity space.

These developments, alongside what he views as a constructive macro environment for security spending, underpin Essex’s positive stance on the stock.

While we acknowledge the potential of ZS as an investment, 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.

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Disclosure: None.