Zeta Global Holdings Corp (ZETA) AI Stock Analysis

Compare

1,438 Followers

ZETA Dividends

Top Page

Zeta Global Holdings Corp

(NYSE:ZETA)

61Neutral

Zeta Global Holdings Corp's overall stock score reflects its strong revenue growth and robust cash flow, which are promising for future expansion. However, the company struggles with profitability, as seen in its negative net income and margins, which impacts its valuation. The technical analysis indicates a bearish trend with risks of further decline. Nevertheless, the positive earnings call, highlighting record financial performance and a strong growth outlook, boosts the overall score. Addressing profitability will be key to improving the company's financial health and stock performance.

Positive Factors

Financial Performance

Zeta Global reported strong 4Q results, with revenue 7% above expectations and free cash flow 2% above estimates.

Growth Strategy

Zeta's 2028 plan projects 20% organic compounding revenue growth and EBITDA margins of at least 25%, indicating a positive long-term outlook.

Market Position

The company is benefiting from its broad front-office platform that increasingly incorporates more AI functionality, helping it gain market share.

Negative Factors

Revenue Growth

Excluding political revenue contributions, the organic revenue growth guidance for 2025 could be seen as disappointing, at 13.7%.

Stock Price Movement

Shares are curiously trading off in after-hours trading, but analysts are buyers on the weakness.

Zeta Global Holdings Corp (ZETA) vs. S&P 500 (SPY)

Market Cap

$2.99B

Dividend YieldN/A

Average Volume (3M)4.95M

Price to Earnings (P/E)―

Beta (1Y)2.10

Revenue Growth38.02%

EPS Growth66.18%

CountryUS

Employees2,191

SectorTechnology

Sector Strength45

IndustrySoftware - Application

Share Statistics

EPS (TTM)-0.42

Shares Outstanding213,627,380

10 Day Avg. Volume4,911,773

30 Day Avg. Volume4,948,887

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)3.41

Price to Cash Flow (P/CF)19.60

P/FCF Ratio27.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$31.00

Price Target Upside146.82% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering14

Zeta Global Holdings Corp Business Overview & Revenue Model

Company DescriptionZeta Global Holdings Corp (ZETA) is a data-driven marketing technology company that provides enterprises with a comprehensive suite of solutions designed to enhance customer engagement and optimize marketing strategies. Operating primarily in the technology and advertising sectors, Zeta Global leverages artificial intelligence and machine learning to offer services such as customer acquisition, retention, and data analytics. The company's platform integrates a vast array of data sources to deliver personalized marketing experiences across multiple channels, including email, social media, and mobile.

How the Company Makes MoneyZeta Global Holdings Corp generates revenue through a combination of subscription-based services and performance-based marketing solutions. The company offers its clients access to a robust marketing platform on a subscription basis, allowing businesses to utilize its advanced data analytics and AI capabilities to drive customer engagement and improve marketing outcomes. Additionally, Zeta Global earns revenue from performance marketing services, where it charges fees based on the success of marketing campaigns, such as lead generation and customer acquisitions. Strategic partnerships with major data providers and technology companies also enhance Zeta's data ecosystem, further contributing to its revenue streams.

Zeta Global Holdings Corp Financial Statement Overview

Summary

Zeta Global Holdings Corp demonstrates strong revenue growth and a robust cash flow position, highlighting its capability to generate cash and reinvest in its business. Despite these strengths, the company faces challenges in achieving profitability, as evidenced by persistent negative net income and margins. The balance sheet has improved with no debt and increasing equity, reducing financial risk. Overall, while the company shows promising growth potential, it must address profitability issues to enhance its financial health.

Income Statement

Positive

Zeta Global Holdings Corp has shown a consistent increase in total revenue over the past years, with a notable growth rate of 38% from 2023 to 2024. The gross profit margin is strong at approximately 60%, indicating effective cost management. However, the company continues to report negative net income, leading to negative net profit margins, which is a significant area of concern. The EBIT and EBITDA margins are also negative, reflecting operational challenges. Overall, the income statement reveals strong revenue growth but persistent profitability issues.

Balance Sheet

Positive

The balance sheet of Zeta Global Holdings Corp is marked by a healthy equity position with a positive stockholders' equity that has grown considerably over the past year. The company has no total debt as of 2024, which significantly improves its debt-to-equity ratio, reducing financial risk. However, the company needs to improve its equity ratio, which stands at around 61%, indicating moderate reliance on liabilities. The balance sheet shows improvement in financial stability with potential risks if equity growth does not sustain.

Cash Flow

Positive

The cash flow statement reflects a strong free cash flow of $108 million in 2024, with a substantial growth rate of 98% from the previous year, indicating increasing operational efficiency. The operating cash flow to net income ratio is healthy, suggesting that the company is generating sufficient cash from its operations even when net income is negative. The free cash flow to net income ratio also supports this trend. The cash flow position is robust, highlighting the company's ability to maintain liquidity and invest in growth opportunities.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
1.01B	728.72M	590.96M	458.34M	368.12M
	Gross Profit
606.20M	454.24M	375.50M	283.62M	219.24M
	EBIT
-67.92M	-167.69M	-258.69M	-245.73M	-457.00K
	EBITDA
-11.70M	-124.36M	-221.55M	-197.21M	4.01M
	Net Income Common Stockholders
-69.77M	-187.48M	-279.24M	-249.56M	-53.23M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
366.16M	131.73M	121.11M	103.86M	50.73M
	Total Assets
1.11B	550.71M	466.50M	397.26M	286.29M
	Total Debt
196.29M	184.15M	183.95M	183.61M	189.69M
	Net Debt
-169.87M	52.41M	62.84M	79.75M	138.97M
	Total Liabilities
434.57M	370.19M	338.47M	306.78M	371.30M
	Stockholders Equity
676.80M	180.52M	128.03M	90.49M	-85.01M
Cash Flow		Free Cash Flow
92.09M	54.55M	39.25M	17.54M	10.33M
	Operating Cash Flow
133.86M	90.52M	78.49M	44.29M	35.54M
	Investing Cash Flow
-97.59M	-54.22M	-48.45M	-46.85M	-25.21M
	Financing Cash Flow
197.92M	-25.65M	-12.63M	55.73M	2.78M

Zeta Global Holdings Corp Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price12.56

Price Trends

50DMA

15.30

Negative

100DMA

17.60

Negative

200DMA

21.55

Negative

Market Momentum

MACD

-0.80

Negative

RSI

50.24

Neutral

STOCH

85.98

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZETA, the sentiment is Neutral. The current price of 12.56 is above the 20-day moving average (MA) of 12.41, below the 50-day MA of 15.30, and below the 200-day MA of 21.55, indicating a neutral trend. The MACD of -0.80 indicates Negative momentum. The RSI at 50.24 is Neutral, neither overbought nor oversold. The STOCH value of 85.98 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ZETA.

Zeta Global Holdings Corp Risk Analysis

Zeta Global Holdings Corp disclosed 42 risk factors in its most recent earnings report. Zeta Global Holdings Corp reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Zeta Global Holdings Corp Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXM	72 Outperform	$1.92B	16.57	18.83%	―	8.74%	150.66%
BL	67 Neutral	$2.96B	21.05	45.56%	―	10.74%	200.08%
ZI	64 Neutral	$2.95B	104.18	1.53%	―	-2.03%	-68.59%
FRSH	64 Neutral	$4.13B	―	-8.63%	―	20.79%	32.50%
ASAN	63 Neutral	$3.72B	―	-92.26%	―	10.94%	4.54%
ZETA	61 Neutral	$2.99B	―	-16.28%	―	38.02%	66.18%
Sector *	59 Neutral	$10.59B	10.09	-6.37%	3.05%	7.44%	-10.67%

* Technology Sector Average

Performance Comparison

ZETA

Zeta Global Holdings Corp

13.14

0.25

1.94%

BlackLine

47.22

-13.61

-22.37%

ZoomInfo Technologies

8.79

-7.58

-46.30%

ASAN

Asana

16.00

0.92

6.10%

CXM

Sprinklr

7.66

-4.27

-35.79%

FRSH

Freshworks

14.07

-4.37

-23.70%

Zeta Global Holdings Corp Earnings Call Summary

Earnings Call Date: Feb 25, 2025 | % Change Since: -39.03% | Next Earnings Date: May 1, 2025

Earnings Call Sentiment Positive

The earnings call was predominantly positive, highlighting record-breaking financial performance, significant AI adoption, successful integration of acquisitions, and a strong growth outlook with the Zeta 2028 plan. Although there were some challenges, such as costs related to defending against a short seller report and working capital headwinds, the positive aspects significantly outweighed the negatives.

Highlights

Record Revenue and EBITDA

Zeta generated record revenue of $315 million in Q4 2024, up 50% year-over-year, and achieved record adjusted EBITDA of $70 million, up 57% year-over-year.

Strong Full-Year Performance

For the full year 2024, Zeta's revenue was over $1 billion, exceeding the initial guidance by $131 million or 15%.

Positive GAAP Net Income

Zeta achieved positive GAAP net income for the first time as a public company with $15.2 million in Q4 2024.

AI Adoption and Impact

AI adoption across Zeta's platform surged with a 200% sequential growth in Q4, significantly impacting consumption revenue, which increased over 40% in 2024.

Successful Integration of LiveIntent

Zeta completed the LiveIntent integration ahead of schedule in early January, leading to the launch of synergistic products like Zeta Direct.

Growth in Scaled Customers

Total scaled customer count grew to 527 by the end of 2024, a 17% increase year-over-year.

Zeta 2028 Plan

Zeta aims for a 20% organic revenue CAGR between 2024 and 2028, targeting over $2.1 billion in revenue by 2028.

Lowlights

Impact of Short Seller Report

Zeta incurred $2 million in additional expenses to defend against a short seller report, although investigations found no merit in the allegations.

Working Capital Headwind from Agencies

A $22 million working capital headwind was noted due to growth with agencies and longer payment cycles in the industry.

Company Guidance

During Zeta's fourth-quarter 2024 earnings call, the company reported record revenue of $315 million, marking a 50% year-over-year increase, and record adjusted EBITDA of $70 million, reflecting a 57% year-over-year rise. Looking ahead, Zeta provided guidance for 2025, predicting a sixth consecutive year of 20%+ growth, with a 20% organic revenue CAGR forecast between 2024 and 2028. The company aims for an adjusted EBITDA margin improvement of 580 basis points to at least 25% and free cash flow margin expansion of 700 basis points to at least 16% by 2028. Zeta highlighted significant AI adoption, with AI agent usage up nearly 200% sequentially in Q4, contributing to a 40% rise in consumption revenue. The company's strategic initiatives also include expanding its customer base and vertical expertise, enhancing its partnership ecosystem, and leveraging its AI capabilities to drive both productivity and revenue gains.

Zeta Global Holdings Corp Corporate Events

Financial Disclosures

Zeta Global Reaffirms Financial Guidance for 2024

Neutral

Dec 9, 2024

Zeta Global Holdings Corp. held an investor conference where it reaffirmed its revenue and Adjusted EBITDA guidance for the fourth quarter and full year 2024, along with its free cash flow projections. This update reinforces their prior announcements, providing investors with a stable outlook on the company’s financial health.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.