Zscaler Inc is well positioned to exceed expectations and raise its full year 2024 billings guidance when the cybersecurity company reports its first quarter fiscal 2024 financial results after the market closes on November 27, according to Jefferies analysts.
In an update to clients, the analysts maintained their ‘Buy’ rating and $225 price target on Zscaler stock, noting the setup feels more attractive given moderated expectations following lackluster results from other cybersecurity companies such as Palo Alto Networks Inc (NYSE:PANW).
"We also expect that ramp deals and AI should help drive upside in full year 2024," the analysts wrote.
They believe Zscaler deserves a premium valuation multiple due to its large and growing total addressable market, benefits from strong Fed spending and Secure Access Service Edge (SASE) demand.
Analysts at Jefferies called Zscaler their “favorite name into year end”.
The Wall Street consensus forecast is for Zscaler to report 1Q earnings per share of $0.49 on revenue of $473.41 million, according to Zacks Equity Research.
Shares of Zscaler edged 0.3% lower to $191.39 in late-afternoon trading on Tuesday and have gained 74% year to date.
Contact Sean at sean@proactiveinvestors.com