News Summary

• Zscaler shares are down more than 20% year-to-date, bucking several cybersecurity stocks that have soared to new highs this year.
• Zscaler's investment case rests on its AI security business becoming a meaningful growth contributor while the core business continues to power on.
• Rising hedge fund ownership suggests that investors are becoming more constructive.
• While we acknowledge the potential of ZS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk.
• If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.