Zscaler: A Buyable Dip As Rule Of 40 Expands
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Gary Alexander32.8K FollowersFollow5ShareSavePlay(10min)CommentsSummaryZscaler has declined nearly 30% from recent highs, entering a technical bear market despite solid fundamentals.ZS's valuation multiples have become more appealing after the correction, especially given its sustained growth and profitability metrics.Management raised FY26 revenue guidance to $3.28–$3.30 billion (22.8%–23.5% y/y growth) with 22% operating and ~26% FCF margins.I reiterate a "Buy" rating, viewing this pullback as a compelling opportunity to accumulate a rare growth/profitability leader in software. Robert Way/iStock Editorial via Getty Images As we approach the final few weeks of 2025, the S&P 500 continues to sit near all-time highs. However, much of these gains are tied up in a concentrated group of large-cap tech stocks that are directly enmeshed in the AI trade. Many otherThis article was written byGary Alexander32.8K FollowersFollowWith combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on Seeking Alpha since 2017. He has been quoted in many web publications and his articles are syndicated to company pages in popular trading apps like Robinhood.Analyst’s Disclosure:I/we have a beneficial long position in the shares of ZS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You