1 Growth Stock Down 25% to Buy Hand Over Fist, According to Wall Street

Core Viewpoint - Zscaler is experiencing a strong recovery in its stock performance, with analysts showing a bullish consensus and the potential for reaching record highs for the first time since 2021 [1][2][12]. Company Performance - Zscaler reported $2.67 billion in revenue for fiscal 2025, marking a 23% increase from the previous year and exceeding management's forecast of $2.66 billion [9]. - The company managed to reduce its GAAP loss to $41.4 million, a 28% improvement from the prior year, while achieving a non-GAAP profit of $535.8 million, up 29% year-over-year [10][11]. Analyst Ratings - Among 49 analysts covering Zscaler, 30 have assigned a buy rating, with none recommending a sell, indicating strong market confidence [12]. - The average price target for Zscaler stock is $318.26, suggesting a potential upside of 13% over the next 12 to 18 months, with a Street-high target of $385 indicating a possible 37% upside [13]. Market Position and Strategy - Zscaler is a leader in zero-trust cybersecurity, addressing vulnerabilities created by the shift to online operations and remote work [4][5]. - The company aims to convince 390 organizations to adopt its Zero Trust Everywhere approach by the end of fiscal 2026, having already secured over 350 by the end of fiscal 2025 [8]. Valuation Metrics - Zscaler's price-to-sales (P/S) ratio has decreased to 16.5 from a peak of over 60 in 2021, positioning it competitively between rivals Palo Alto Networks and CrowdStrike [14]. - The company estimates its addressable market at $96 billion, indicating significant growth potential based on its fiscal 2025 revenue [16].