ZS: UBS Maintains Buy Rating on Zscaler, May 2026

UBS reaffirmed its Buy rating on Zscaler (ZS) on May 20, 2026, maintaining confidence in the cloud security leader. The analyst firm sees shares as underappreciated despite recent market volatility. Zscaler trades at $174.45 with a market cap of $28 billion, serving enterprise customers across financial services, healthcare, and technology sectors. This maintained rating reflects UBS’s conviction in the company’s long-term growth trajectory.

UBS Maintains Buy Rating on Zscaler Stock

UBS reaffirmed its Buy rating on Zscaler, signaling continued confidence in the cloud security provider. The analyst firm published its assessment on May 20, 2026, maintaining the same rating from prior coverage. UBS sees shares as underappreciated, suggesting the market has not fully priced in the company’s value proposition.

The maintained rating comes as Zscaler navigates a challenging macroeconomic environment. Stock trades above its 50-day average of $143.04 and below its 200-day average of $225.73. The company’s $28 billion market cap reflects its position as a leading player in cloud security infrastructure.

Financial Metrics and Analyst Consensus

Zscaler’s financial profile shows mixed signals. The company generated $18.79 in revenue per share and $5.91 in free cash flow per share trailing twelve months. Price-to-sales ratio stands at 9.35x, reflecting premium valuation typical of software infrastructure companies. Operating margins remain negative at -4.76%, though gross margins are healthy at 76.56%.

Analyst consensus remains strongly bullish. Twenty-eight analysts rate the stock Buy, while only five rate it Hold. No analysts recommend Sell or Strong Sell positions. This overwhelming consensus supports UBS’s maintained Buy stance and suggests institutional confidence in Zscaler’s strategic direction.

Meyka AI Stock Grade and Technical Setup

Meyka AI rates ZS with a grade of B+, reflecting balanced fundamentals and growth potential. This grade factors in S&P 500 benchmark comparison, sector performance, financial growth, key metrics, and analyst consensus. The rating suggests the stock offers reasonable risk-reward for growth-oriented investors.

Technical indicators show overbought conditions. RSI stands at 72.27, signaling potential pullback risk. Stochastic oscillator at 87.41 confirms elevated momentum. However, the stock maintains support above its 50-day moving average, indicating underlying strength despite short-term overbought readings.

Growth Trajectory and Market Position

Zscaler delivered 23.3% revenue growth in fiscal 2025, demonstrating strong demand for cloud security solutions. Free cash flow grew 24.2% year-over-year, showing improving operational efficiency. The company serves 7,348 employees across global operations, supporting enterprise customers in financial services, healthcare, and technology sectors.

The cloud security market remains a growth priority for enterprises managing distributed workforces. Zscaler’s Internet Access and Private Access solutions address critical security gaps. UBS’s maintained Buy rating reflects confidence that Zscaler will capture market share as organizations accelerate cloud adoption and security spending.

Final Thoughts

UBS’s maintained Buy rating on Zscaler underscores analyst confidence in the cloud security provider’s long-term value. Despite near-term technical overbought conditions and negative operating margins, the company’s 23.3% revenue growth, strong free cash flow generation, and dominant market position support the bullish thesis. With 28 analysts rating the stock Buy and Meyka AI assigning a B+ grade, Zscaler appears well-positioned for investors seeking exposure to cloud security infrastructure. The maintained rating suggests UBS sees current valuations as attractive for long-term holders.

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Stock markets involve risks. This content is for informational purposes only. Analyst ratings are opinions and not guarantees of future performance. Past performance does not guarantee future results. Meyka AI PTY LTD provides market analysis and data insights, not financial advice. Always conduct your own research and consider consulting a licensed financial advisor.