Zscaler Valuation

Is ZS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of ZS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: ZS ($181.05) is trading below our estimate of fair value ($252.78)

Significantly Below Fair Value: ZS is trading below fair value by more than 20%.


Key Valuation Metric

Which metric is best to use when looking at relative valuation for ZS?

Other financial metrics that can be useful for relative valuation.

ZS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue13x
Enterprise Value/EBITDA-249.9x
PEG Ration/a

Price to Sales Ratio vs Peers

How does ZS's PS Ratio compare to its peers?

The above table shows the PS ratio for ZS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average13.8x
FTNT Fortinet
8.5x12.0%US$46.0b
MNDY monday.com
14.2x20.4%US$11.2b
GEN Gen Digital
4x2.6%US$15.3b
CRWD CrowdStrike Holdings
28.4x20.0%US$93.2b
ZS Zscaler
13.5x18.6%US$27.4b

Price-To-Sales vs Peers: ZS is good value based on its Price-To-Sales Ratio (13.5x) compared to the peer average (13.8x).


Price to Earnings Ratio vs Industry

How does ZS's PE Ratio compare vs other companies in the US Software Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a15.6%
n/an/an/a
No. of CompaniesPS048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a15.6%
n/an/an/a
No more companies

Price-To-Sales vs Industry: ZS is expensive based on its Price-To-Sales Ratio (13.5x) compared to the US Software industry average (4.2x).


Price to Sales Ratio vs Fair Ratio

What is ZS's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

ZS PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio13.5x
Fair PS Ratio11.3x

Price-To-Sales vs Fair Ratio: ZS is expensive based on its Price-To-Sales Ratio (13.5x) compared to the estimated Fair Price-To-Sales Ratio (11.3x).


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst ZS forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$181.05
US$229.67
+26.9%
12.3%US$290.00US$180.00n/a40
Jun ’25US$169.96
US$233.19
+37.2%
13.0%US$290.00US$180.00n/a40
May ’25US$172.31
US$258.52
+50.0%
9.1%US$310.00US$213.00n/a41
Apr ’25US$192.13
US$259.48
+35.1%
8.9%US$310.00US$213.00n/a40
Mar ’25US$219.23
US$257.92
+17.6%
9.5%US$310.00US$210.90n/a39
Feb ’25US$238.06
US$241.85
+1.6%
12.7%US$311.00US$183.00n/a41
Jan ’25US$221.56
US$221.54
-0.01%
11.0%US$275.00US$180.00n/a39
Dec ’24US$198.03
US$205.32
+3.7%
8.1%US$229.00US$165.00n/a38
Nov ’24US$156.65
US$184.83
+18.0%
10.1%US$225.00US$134.29n/a39
Oct ’24US$155.59
US$181.26
+16.5%
8.9%US$225.00US$134.29n/a39
Sep ’24US$158.38
US$168.32
+6.3%
12.2%US$225.00US$120.00n/a39
Aug ’24US$162.80
US$167.85
+3.1%
12.7%US$225.00US$120.00n/a38
Jul ’24US$146.30
US$168.06
+14.9%
12.6%US$225.00US$120.00n/a37
Jun ’24US$135.09
US$152.45
+12.9%
18.3%US$225.00US$120.00US$169.9637
May ’24US$88.74
US$153.83
+73.3%
18.2%US$225.00US$115.00US$172.3138
Apr ’24US$116.83
US$155.09
+32.7%
17.2%US$225.00US$120.00US$192.1338
Mar ’24US$128.44
US$165.71
+29.0%
18.9%US$275.00US$120.00US$219.2337
Feb ’24US$131.52
US$166.14
+26.3%
19.5%US$275.00US$115.00US$238.0638
Jan ’24US$111.90
US$179.26
+60.2%
17.2%US$275.00US$135.00US$221.5636
Dec ’23US$144.50
US$199.74
+38.2%
15.6%US$280.00US$155.00US$198.0335
Nov ’23US$150.39
US$211.86
+40.9%
11.9%US$280.00US$160.00US$156.6535
Oct ’23US$164.37
US$212.26
+29.1%
11.6%US$280.00US$165.00US$155.5931
Sep ’23US$145.57
US$206.72
+42.0%
15.8%US$310.00US$150.00US$158.3829
Aug ’23US$153.50
US$203.72
+32.7%
16.2%US$310.00US$150.00US$162.8029
Jul ’23US$155.37
US$204.58
+31.7%
16.5%US$310.00US$150.00US$146.3031
Jun ’23US$148.94
US$221.93
+49.0%
28.3%US$430.00US$150.00US$135.0932

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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