TLDR
- Zscaler (ZS) shares rose as much as 6.99% on May 1, buoyed by strong earnings and elevated expectations from SaaS peers including Atlassian and Twilio.
- Citizens cut their price target on ZS from $290 to $210 but maintained an Outperform rating.
- ZS is trading at $139.58, down 36.7% year to date and down 58.5% from its 52-week high of $336.27.
- The KeyBanc CIO Survey cited rising cyber budgets associated with AI adoption as a positive driver for cybersecurity platforms.
- The stock has made 18 moves greater than 5% over the past year, reflecting ongoing volatility.
Zscaler (ZS) stock rose as much as 6.99% on May 1, riding on a wave of positive sentiment sweeping the software sector after several major peers posted strong results.
The stock was trading at $139.58 before the session – a price that is 58.5% below its 52-week high of $336.27, which it reached in November 2025.
The immediate trigger was not specific to Zscaler. Atlantic It raised its annual forecast, sending its stock higher and pulling down names like Salesforce and ServiceNow in the process.
Twilio The company added to the mood after reporting first-quarter revenue that beat estimates and raised its own forecasts, with its CEO citing artificial intelligence as a key driver.
This kind of peer momentum tends to lift the entire sector, and ZS was no exception.
Citizens lower target but remain bullish
Not everything on May 1 was positive for Zscaler. Citizens cut its price target on the stock to $210 from $290.
The downgrade reflects concerns that frontier AI could intensify cyber threats and force a reset in how cybersecurity assessments are priced across the sector.
Despite this, Citizens maintained its Outperform rating — a sign the company still sees upside from current levels, even as the valuation picture becomes more complex.
Demand for Zero Trust and SASE solutions, which are at the core of Zscaler’s business, remains strong according to the company.
Focus on artificial intelligence and cyber budgets
About ten days before the May 1 move, ZS stock rose 4.1% after a KeyBanc survey of IT managers indicated growing cybersecurity budgets tied to AI adoption.
Highlights of the survey Anthropic Mythos Artificial Intelligence Model as a factor likely to drive increased enterprise spending on security over the next year.
The thinking is straightforward: more AI means more attack surface, and companies are expected to spend more to protect it.
These tailwinds helped offset some of the pressures Zscaler faced in 2026.
ZS has been one of the hardest-hit names in cybersecurity this year, down 36.7% since January 1.
The stock has seen 18 moves greater than 5% in the past year, which shows how reactive it is to sector news and broader market volatility.
An investor who invested $1,000 in Zscaler five years ago would be sitting at roughly $772.93 today.
The stock’s average daily trading volume is just over $3 million, and its current market cap is $21.01 billion.
Citizens’ revised price target of $210 still indicates a significant upside from the $139.58 level where ZS traded on May 1.
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