Truist Securities Buoyed by Zscaler (ZS)’s Emerging Business Growth, Affirms Buy Stance

Core Viewpoint - Zscaler Inc. is highlighted as a strong long-term investment opportunity, with analysts at Truist Securities maintaining a 'Buy' rating and a price target of $350, driven by growth in its emerging business segment [1][2]. Group 1: Business Strategy and Growth - The management team emphasized the company's long-term platform strategy, focusing on the Zero Trust Branch Offering [2]. - The Z-Flex licensing model, introduced recently, has become a significant growth driver due to its commitment-based subscription model, contrasting with traditional consumption or enterprise models [2]. - In Q4 of fiscal 2025, the Z-Flex program achieved over $100 million in total contract value bookings, marking a 50% increase quarter-over-quarter [3]. Group 2: Financial Performance - Zscaler reported revenue of $719 million for the quarter, surpassing consensus estimates of $706.95 million, largely attributed to the growth from the Z-Flex program [3]. Group 3: Company Overview - Zscaler Inc. is a cloud-based cybersecurity firm that offers a Zero Trust Exchange platform, which replaces traditional network security with cloud-delivered services, enabling secure internet access and application connectivity for distributed workforces [4].