| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 134.00 | -34 |
| Intrinsic value (DCF) | 344.54 | 71 |
| Graham-Dodd Method | 5.80 | -97 |
| Graham Formula | n/a |
Zscaler, Inc. is a global leader in cloud security, providing innovative solutions to secure digital transformation for enterprises. Headquartered in San Jose, California, Zscaler operates a cloud-native platform that enables secure access to applications and services, regardless of location or device. The company's flagship products, Zscaler Internet Access (ZIA) and Zscaler Private Access (ZPA), offer comprehensive security for internet and private application access, respectively. Additionally, Zscaler Digital Experience monitors user experience, while its workload segmentation solutions enhance cloud security posture. Serving industries such as financial services, healthcare, and technology, Zscaler's platform is designed to reduce risk, ensure compliance, and prevent data breaches. As businesses increasingly adopt cloud and hybrid work models, Zscaler is well-positioned to capitalize on the growing demand for scalable, zero-trust security solutions.
Zscaler presents a compelling investment opportunity in the rapidly expanding cloud security market, driven by the shift to remote work and increasing cyber threats. The company's strong revenue growth and robust operating cash flow highlight its ability to scale efficiently. However, investors should note Zscaler's current lack of profitability, reflected in negative net income and diluted EPS. The high beta of 1.143 indicates higher volatility compared to the market, which may appeal to growth-oriented investors but could deter those seeking stability. With a market cap of approximately $39.5 billion, Zscaler is a significant player, but competition in cloud security remains intense. The company's zero-trust architecture and cloud-native approach provide a competitive edge, but execution risks and macroeconomic factors could impact future performance.
Zscaler competes in the cloud security market with a unique zero-trust architecture that eliminates the need for traditional VPNs and firewall appliances. Its cloud-native platform offers scalability and flexibility, which are critical for enterprises adopting hybrid work models. Unlike legacy security providers, Zscaler's solutions are designed for the cloud era, providing seamless security across SaaS, IaaS, and private applications. The company's focus on reducing attack surfaces and preventing lateral threat movement differentiates it from competitors. However, Zscaler faces challenges from established players with broader product portfolios and deeper customer relationships. Its ability to innovate and execute in a crowded market will be crucial for maintaining its leadership position. The company's partnerships with major cloud providers and emphasis on AI-driven threat detection further strengthen its competitive positioning. Despite these advantages, pricing pressure and the need for continuous R&D investment pose ongoing challenges.