Zscaler stock drops 16% due to market concerns, but strong fundamentals suggest long-term potential

From Nasdaq: 2024-08-13 09:09:00

Zscaler, Inc. (ZS) stock price has dropped nearly 16% in the past month, exceeding the broader market’s performance. Market concerns over the Federal Reserve’s policies and fears of a U.S. recession are driving the sell-off.

Despite macroeconomic challenges, Zscaler has consistently beaten earnings expectations. Revenue increased 32% year-over-year in Q3 fiscal 2024, with a 83% surge in non-GAAP earnings per share.

Zscaler’s strategic acquisitions and innovative platforms have attracted a diverse customer base. With partnerships with Microsoft, Amazon, and Google Cloud, Zscaler strengthens its market position and offers state-of-the-art security solutions.

While Zscaler shows promise, its high valuation and technical indicators signal caution. Its stock price remains above industry averages, and recent movements below moving averages could indicate further downside.

In conclusion, Zscaler’s strong fundamentals and growth potential make it a solid long-term investment. Hold for existing shareholders, as the company’s long-term drivers remain intact amid market turbulence. Zacks Rank #3 (Hold).



Read more at Nasdaq: Zscaler (ZS) Plunges 16% in a Month: Should You Buy the Dip?