Analysts Cite Zscaler’s 22% YTD Drop as AI-Driven Buy Opportunity
Wedbush analyst Dan Ives flagged cybersecurity names like Zscaler, which is down 22% year to date, as buying opportunities due to anticipated AI-driven demand growth. Bernstein analysts added that recent sell-offs in AI-exposed tech may be overdone given AI’s capacity to enhance rather than replace current workflows.
1. Analysts Push Back Against AI Sell-Off
As fears grew that AI would erode margins across software and logistics sectors, Wall Street analysts argued that AI integration will boost businesses rather than harm them.
2. Wedbush Flags Cybersecurity Opportunities
Wedbush’s Dan Ives identified Zscaler, down 22% YTD, alongside CrowdStrike and Palo Alto Networks as attractive buys based on expected AI-driven security demand.
3. Overdone De-Rating in AI-Exposed Tech
Bernstein analysts noted that coding comprises only a fraction of engineers’ activities, suggesting recent sell-offs in AI-adjacent sectors may be overblown given AI’s broader enhancement potential.