Trading Zscaler After Fiscal Q2 2024 Performance

March 06, 2024 03:51

Founded in 2007, Zscaler operates the world's largest any-to-any security cloud platform. It is one of the leaders in cloud security with more than $2 billion in annual recurring revenue. Learn more about Zscaler's fiscal second-quarter performance and what the analysts are forecasting for the stock.

Stock: Zscaler 
Symbol for Invest.MT5 Account: ZSUS
Date of Idea: 5 March 2024
Time Line: 1 - 6 months
Entry Level: $245.00
Target Level: $310.00
Position Size for Invest.MT5 Account: Max 5%
Risk: High
  • The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.

All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose, as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing. 

Zscaler Fiscal Q2 2024 Performance

Here are some of the key highlights from the latest fiscal second-quarter 2024 earnings report from Zscaler: 

  • Earnings per share of 76 cents per share vs 58 cents per share expected 
  • Revenue rose to $525 million vs $508 million expected 
  • Calculated billings of $628 million vs $611 expected 
  • Revenue up 35% year-over-year 
  • Net income loss of $28.5 million compared to $57.5 million same time last year 

Zscaler beat analyst expectations on most metrics including earnings per share, revenue and billings. In the earnings call, chief executive Jay Chowdhry stated that "more customers see the shortcomings of traditional firewall-based security and are engaging with us to transform to the Zero Trust architecture."  

The Zscaler Zero Trust architecture is a security architecture built to reduce a network's attack surface and lower the risk of a data breach. The cybersecurity company built the industry's first single-vendor SASE solution Zero Trust. The growth in its products is one reason the company lifted its fiscal third quarter revenue figures from $534 million to $536 million. The market was expecting $532 million.  

While the earnings report was strong in most areas, a net income loss was reported. Although, it was a smaller loss compared to the same time last year. As a result, the stock dropped sharply - nearly 8% - after the earnings release.  

Most younger tech companies tend to report a net income loss as they reinvest as much money as possible back into the business for it to grow. However, the drop in the stock price may be a warning sign that investors are reallocating funds to stocks that are growing more rapidly to try and capitalise on the US bull market.  

As such, caution is warranted. More analysts have also shifted to a hold rating on the stock as seen below.  

Zscaler Stock Forecast - What do the Analysts Say?

According to analysts polled by TipRanks for a Zscaler stock forecast in the past 3 months, there are currently 27 buy, 7 hold and 0 sell ratings on the stock. The highest price level for a Zscaler stock forecast is $310.00 with the lowest price target at $214.00. 

The average price target for a Zscaler stock forecast is $261.47.

Source: TipRanks, 5 March 2024


An Example Trading Idea for the Zscaler Stock Price

An example trading idea for the Zscaler share price could be as follows:  

  • Buy the stock on a break above the post-earnings high at $245.00 to allow for volatility. 
  • Target just below the highest analyst price target of $310.00. 
  • Keep your risk small at a maximum of 5% of your total account.   
  • Time Line = 1 – 6 months  
  • If you buy 10 Zscaler shares:  
    • If target is reached = $650.00 potential profit [($310.00 - $245.00) * 10 shares].

Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering the stock is still down around 45% from its all-time high.

Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.

With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Zscaler stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.

There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall! 

How to Buy Zscaler Stock in 4 Steps  

With Admirals, you can buy shares in companies like Zscaler with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks. 

  1. Open an account with Admirals to access the dashboard.   
  2. Click on Trade on one of your live or demo accounts to open the web platform.   
  3. Search for your stock in the search window at the top right to view the live price chart. 
  4. Click Create New Order from the bottom of the screen to open the trading ticket. 
Source: Admirals MetaTrader 5. Zscaler. Monthly. Date: January 2018 to March 2024, captured on 5 March 2024. Past performance is not a reliable indicator of future results or future performance.


Click on the banner below to trade Zscaler stock today ▼▼▼ 

Do You See the Zscaler Stock Price Moving Differently?   

Remember that all analytics and trading ideas are based on the personal view and experience of the author.

If you believe there is a higher chance Zscaler share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.

The Trade.MT5 and Trade.MT4 account allows you to speculate on the price direction of stocks and shares using CFDs.

This means you can trade long and short to potentially profit from rising and falling stock prices.


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Jitanchandra Solanki
Jitanchandra Solanki Financial Markets Author, Admirals London

Jitanchandra is a financial markets author with more than 15 years experience trading currencies, indices and US equities. He is an accredited Market Technician with a BA Hons degree.