Zscaler (NasdaqGS:ZS) Stock Surges 12% In Last Week

Zscaler (NasdaqGS:ZS) recently announced its collaboration with T-Mobile to implement a hybrid zero trust security model, showcasing significant advancements in cybersecurity. Over the past week, the company's stock experienced an 12% increase, a notable move that contrasts with the overall market's flat performance during a volatile week influenced by tariff news and fluctuating tech stocks. While broader market moves were driven by fluctuating investor sentiment around global trade and earnings reports, Zscaler's collaboration highlights its pivotal role in enhancing digital security, potentially bolstering investor confidence and contributing to its positive price performance amidst market uncertainties.

Be aware that Zscaler is showing 1 weakness in our investment analysis.

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The collaboration between Zscaler and T-Mobile is poised to enhance Zscaler's position in the cybersecurity market by expanding its reach in implementing advanced security models. This development could have positive implications on Zscaler's forecasted revenue and earnings, aligning with the company's narrative of growth through innovative solutions like Zero Trust. Analysts already anticipate a robust 21% annual revenue growth over the next few years, and this partnership may reinforce such projections. With an estimated earnings of US$110.4 million by 2028, this new collaboration highlights the opportunity for Zscaler to capitalize on increased demand for cybersecurity innovations.

Over a five-year span, Zscaler's total shareholder return, including share appreciation and dividends, was 187.29%. This reflects a solid return, contrasting with the company's recent one-year performance of exceeding the broader US market, which remained stagnant at 0%. However, relative to the software industry's decline of 3.9%, this performance indicates Zscaler's strength within its sector.

Currently trading at US$177.04, Zscaler's stock is seen as undervalued compared to the consensus analyst price target of US$237.44. The recent 12% increase in stock price brings Zscaler closer to this target, suggesting room for further growth if forecasts are accurate. Analysts believe the stock could appreciate by 21.2%, implying optimism about Zscaler's capacity to drive future earnings through sustained innovation and strategic partnerships. Nonetheless, stakeholders should assess whether the company's growth trajectory aligns with their own perspectives on its financial potential.

Gain insights into Zscaler's historical outcomes by reviewing our past performance report.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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