--- title: "Zscaler hit the Street's $233 target before its new sales chief reported a quarter" description: "An AI-found flaw in PHP, eleven price-target raises and a $270 bull call have carried ZS back to the Street's $233 mean at 47 times forward earnings. Late November brings the first quarter under the sales chief who inherited the machine." publisher: "The Inference" section: "Security" published: 2026-10-23T15:16:25.799Z modified: 2026-10-23T15:16:25.799Z canonical: https://theinference.org/article/zscaler-hit-the-street-s-233-target-before-its-new-sales-chief-reported-a-quarter language: en keywords: "Zscaler, Cybersecurity, Analyst Calls, Price Targets, Stock Moves" --- # Zscaler hit the Street's $233 target before its new sales chief reported a quarter > An AI-found flaw in PHP, eleven price-target raises and a $270 bull call have carried ZS back to the Street's $233 mean at 47 times forward earnings. Late November brings the first quarter under the sales chief who inherited the machine. ## Two holes in a 30-year-old language did the buying On October 21, PHP, the language behind about 70% of the web, [shipped emergency patches for two flaws](https://www.unite.ai/php-patches-two-critical-rce-flaws-found-with-frontier-ai-models/) that let attackers run code on unpatched servers, holes found by AI models at [OpenAI](https://theinference.org/markets/companies/openai), Wiz and the research firm Calif before criminals got there [5]. Buyers treated the patch as a revenue event: [Zscaler](https://theinference.org/markets/companies/zscaler) rose 7.4% to $230.38 that day [6], rose again Thursday [2], and by Friday morning traded at $237, past the Street's $233 average price target [1][7]. ## Back at the mean, at 47 times earnings The rally completed a 14% month and an 85% rebound since April, and lifted the forward earnings multiple from 28x in late June to about 47x, still under the four-year average near 64x [1][2]. A $34.98 billion company [3] now sits at the consensus target, a number that has itself climbed from $193 in mid-July [1]. ## The re-rating prices a handover nobody has reported yet Chief revenue officer Mike Rich built the sales overhaul that lifted net-new ARR growth to 17% in the July quarter from 7% a year earlier; he left in September, the stock fell 10% in a day, and CFO [Kevin Rubin](https://theinference.org/markets/people/kevin-rubin) had tied part of the cautious fiscal 2027 guide to the leadership change [1]. The October 6 Investor Day reaffirmed that guide, with CEO Jay Chaudhry calling agentic AI "the most significant opportunity in our company's history" and pointing to a $10 billion ARR target [7]. Eleven firms raised targets the next morning, [Evercore](https://theinference.org/markets/companies/evercore) ISI to $195, Baird to $285 [1]. The Street has repriced as settled the one risk Zscaler's own CFO named, before new chief revenue officer Ross Tackett has reported a single quarter [1][7]. ## What November has to hold Revenue growth has run near 25% for four straight quarters [9], and the fiscal 2027 guide steps it down to 16.6–17.5% [8]. July-quarter ARR grew 25%, but $141 million of that came from the Red Canary acquisition [8]; the newer growth engines, the ones meant to carry the next leg, grew ARR 60% combined last year [1]. [Insiders sold $23.4 million of stock over 12 months](https://www.gurufocus.com/news/9134204/da-davidson-initiates-coverage-of-zscaler-zs-with-neutral-rating-and-125-price-target) without a single purchase, twelve of those sales in the past three months [3]. *Chart: **Growth has held near 25% for four quarters; the fiscal 2027 guide steps down to 17%** Line chart of Zscaler quarterly revenue growth in percent year over year from late 2023 to mid 2026, slowing from about 40% to about 25%, with the fiscal 2027 guide of 16.6 to 17.5% annotated* *Reported quarterly revenue, percent change from the same quarter a year earlier, fiscal quarters ending October 2023 through July 2026, from SEC filings. Guide from the October 6, 2026, reaffirmation. [8][9]* *Chart: **The bull calls sit above a $233 mean the stock has already reached** Bar chart of analyst price targets for Zscaler: Evercore ISI 195, D.A. Davidson 215, Street mean 233, Freedom Broker 270, Baird 285 dollars per share* *Analyst price targets, dollars per share. Street mean is the 47-analyst consensus as of October 22, 2026; Evercore ISI and Baird bracket the post-Investor-Day raises of October 7, D.A. Davidson initiated October 21, Freedom Broker raised October 22. [1][2][6]* ## The wave is real, and it is already in the model The bull case has substance: every PHP release of the past decade is exposed to at least one of the new flaws [5], and [Zscaler's ThreatLabz data](https://thenextweb.com/news/enterprise-ai-footprint-visibility-security-zscaler) shows enterprise AI traffic up 83% in 2025 across roughly 9,000 organizations, with 410 million data-loss violations tied to ChatGPT alone [4]. "What's happening in cybersecurity is a COVID-like wave," Dragonfly managing partner Haseeb Qureshi posted [2]. Yet [consensus already carries revenue from $3.35 billion to $5.33 billion by fiscal 2029](https://finance.yahoo.com/markets/stocks/articles/zscaler-gains-3-270-price-205603590.html) [2]. D.A. Davidson initiated at Neutral, $215, on October 21, calling the stock close to fairly valued at roughly 33 times calendar-2027 free cash flow [3][6]; Freedom Broker went to $270 the next morning [2]. The wave has to push budgets past what is modeled to move the stock from here. ## Five weeks to the first Tackett quarter Fiscal Q1 lands in late November, [guided to $935–939 million, up about 19%](https://finance.yahoo.com/markets/stocks/articles/zscaler-announces-strong-fourth-quarter-200500028.html) [8]. Watch net-new ARR and the 60% engines: the May report cost 31.5% in a day [1], and a stock at its mean target gives a first-time sales chief no cushion. The Investor Day guide and the insider sale notices are mapped in [earlier reporting](https://theinference.org/article/zscaler-calls-ai-its-biggest-opportunity-then-repeats-guidance-that-slows-growth-by-a-third). ## Takeaway Zscaler is back at the Street's $233 mean target on 47 times forward earnings before new chief revenue officer Ross Tackett has reported a quarter; late-November fiscal Q1 results settle whether the re-rating holds. ## Sources 1. [TIKR, "Zscaler Just Gained 14% in a Month: Take Profits, or Buy More?", 22 October 2026](https://www.tikr.com/blog/zscaler-just-gained-14-in-a-month-take-profits-or-buy-more) 2. [Yahoo Finance, "Zscaler Gains 3% on $270 Price Target Raise as Cyber Rally Extends: 'A COVID-Like Wave'", 22 October 2026](https://finance.yahoo.com/markets/stocks/articles/zscaler-gains-3-270-price-205603590.html) 3. [GuruFocus, "D.A. Davidson Initiates Coverage of Zscaler (ZS) with Neutral Rating", 21 October 2026](https://www.gurufocus.com/news/9134204/da-davidson-initiates-coverage-of-zscaler-zs-with-neutral-rating-and-125-price-target) 4. [The Next Web (contributed), "Your enterprise has more AI than you think, and security can't see it all", 22 October 2026](https://thenextweb.com/news/enterprise-ai-footprint-visibility-security-zscaler) 5. [Unite.AI, "PHP Patches Two Critical RCE Flaws Found with Frontier AI Models", 21 October 2026](https://www.unite.ai/php-patches-two-critical-rce-flaws-found-with-frontier-ai-models/) 6. [Benzinga via MSN, "What's driving Zscaler stock higher Wednesday?", 21 October 2026](https://www.msn.com/en-us/money/general/what-s-driving-zscaler-stock-higher-wednesday/ar-AA2fL90H) 7. [Zscaler press release (GlobeNewswire) via Markets Insider, "Zscaler Hosts 2026 Investor Day, Reaffirms First Quarter and Fiscal 2027 Guidance", 6 October 2026](https://markets.businessinsider.com/news/stocks/zscaler-hosts-2026-investor-day-reaffirms-first-quarter-and-fiscal-2027-guidance-1036600358) 8. [Zscaler press release (GlobeNewswire) via Yahoo Finance, "Zscaler Announces Strong Fourth Quarter and Fiscal 2026 Financial Results", 3 September 2026](https://finance.yahoo.com/markets/stocks/articles/zscaler-announces-strong-fourth-quarter-200500028.html) 9. [Zscaler quarterly figures from its SEC filings, retrieved 23 October 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001713683) --- Zscaler hit the Street's $233 target before its new sales chief reported a quarter — The Inference. Canonical: https://theinference.org/article/zscaler-hit-the-street-s-233-target-before-its-new-sales-chief-reported-a-quarter