Zscaler slides after BTIG downgrade deepens pain

Cloudflare

09/04/2026 15:08

** Shares of cloud security firm Zscaler ZS.O hit their lowest in nearly three years, last down 9.2%

** Brokerage firm BTIG downgrades stock to "neutral" from "buy," citing concerns over demand and potential competition

** Says Netskope NTSK.O and Cloudflare NET.N have become more credible rivals

** While demand in the near term is stable, the trends beyond that could be more cautious - BTIG

** Cybersecurity industry has come under pressure in recent months due to fears of disruption from AI models

** ZS is trading at 31.4 times expected earnings over the next 12 months, hovering around its lowest levels ever, according to LSEG data

** Out of 50 analysts, 41 rate ZS "buy" or higher, while rest rate it "hold" -- LSEG-compiled data

** YTD as of last close, ZS has lost 38.7% of its value in a bruising selloff, while NTSK is down 46.6%

** NET, on the other hand, has climbed 7.2% YTD

(Reporting by Niket Nishant in Bengaluru)

((Niket.Nishant@thomsonreuters.com))