Zscaler Inc (ZS) Long-Term Outlook Intact amid Industry Compression

Zscaler Inc. (NASDAQ:ZS) is one of the AI stocks that will go to the moon. On February 17, Mizuho analyst Gregg Moskowitz lowered his price target of Zscaler Inc. (NASDAQ:ZS) to $265 from $310 and reiterated an Outperform rating. The price target cut comes amid concerns of multiple compressions in the sector.

Zscaler Inc (ZS) Long-Term Outlook Intact amid Industry Compression

Despite the price target cut, the analyst believes there are uncommonly attractive investment opportunities in the software sector for investors willing to be somewhat patient. Sentiment in the software sector remains muted amid fears of disruption from artificial intelligence.

Meanwhile, on February 13, Bernstein upgraded Zscaler to an Outperform and cut its price target to $228 from $264, noting Feb. 26 earnings could act as a re‑rating catalyst. The sentiment follows a December downgrade of the stock on concerns about the durability of the company’s 20% growth amid heightened competition. There were concerns that the company’s growth could drop below 20% by 2028 and to 15% over the next five years.

Zscaler Inc (NASDAQ:ZS) is a cloud-native cybersecurity company that provides a “Zero Trust Exchange” platform to securely connect users, devices, and applications from any location, replacing traditional, perimeter-based security appliances with a cloud-based model. It specializes in securing internet access (ZIA), private applications (ZPA), and digital experiences (ZDX) for enterprises.

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 this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.