Sep. 12 at 2:23 PM
$ZS Why it matters: Similar to its cyber peers, Zscaler is benefiting from a healthy cyber demand environment. Artificial intelligence models' increasingly impressive cyber offense capabilities are expanding cyber defense budgets as enterprises improve their security infrastructures.
We like the firm's focus on focusing on security solutions that benefit from this secular tailwind, with AI security solutions' bookings growing more than 50% this quarter. Also, 70% of these AI security wins also included data security modules, highlighting Zscaler's growing platform.
The bottom line: We maintain our
$250 per share fair value estimate for narrow-moat Zscaler, and with shares trading mostly flat after hours, we continue to view shares as undervalued.
