Zscaler Inc. (NASDAQ: ZS) was trading at approximately $178 on Friday, May 22, ahead of the company’s fiscal third-quarter earnings report scheduled for the following Tuesday, with analyst attention focused on billings growth and whether the company’s raised annual recurring revenue guidance will be confirmed by the latest results.
ZS’s 52-week range of $114.63 to $336.99 places the current price in the lower half of the annual band, reflecting the significant derating the stock experienced during the broader software sell-off triggered by AI disruption fears earlier in 2026.
The most significant stock-specific story for Zscaler on Friday was an AI security deal with Symmetry Systems, an agreement that sparked a debate among analysts about its valuation implications and whether it meaningfully expands Zscaler’s addressable market beyond its core Zero Trust network access platform.
Simply Wall St published analysis this week assessing Zscaler’s valuation after the company raised its annual recurring revenue guidance in recent weeks, noting that improving investor sentiment had driven a partial recovery in the stock from the February 2026 lows.
Zscaler competes directly with Palo Alto Networks, CrowdStrike, and Cloudflare in the enterprise security market, with each company pursuing a platform consolidation strategy that positions it as the single vendor capable of replacing point solutions across an organisation’s security architecture.
The AI coding assistant debate that weighed on enterprise software stocks in early March 2026 disproportionately affected Zscaler, with retail investors on Stocktwits turning extremely bullish on ZS immediately after the sell-off as they identified the decline as excessive relative to the company’s fundamental outlook.
TD Cowen argued at the time that AI coding assistants enhance productivity but do not replace core security platforms, a view that has broadly prevailed in the analyst community and helped Zscaler recover from the March lows.
The company’s Zero Trust architecture has become increasingly relevant in 2026 as AI workloads create new attack surfaces that traditional perimeter security models cannot adequately address, driving enterprise interest in Zscaler’s cloud-delivered access control and inspection capabilities.
Volume on May 22 was approximately in line with the 3.76 million daily average, suggesting the session was relatively quiet positioning ahead of what the market expects to be a significant earnings catalyst on Tuesday.
Wall Street analysts are broadly constructive on ZS, with the consensus view that the company’s ARR trajectory will reaccelerate in the second half of fiscal 2026 as enterprise AI security budgets expand and the company’s platform consolidation pitch gains broader traction.
