Zeta Global Holdings (ZETA): Future Growth and Stock Outlook

This site is a great place for me (@mifsee(2) has been working on company and stock analysis while learning privately.

This is only a record of my personal analysis and the contents may contain errors or information that differs from the actual situation. Please understand in advance when viewing this site.

Introduction.

Zeta Global Holdings (ZETA) is a fast-growing company in the marketing cloud space using AI and big data.

With personalized solutions for enterprise customers, the company helps clients in a wide range of industries improve their bottom line and efficiency.

In particular, we will explore in detail Zeta's business, strengths, and future growth strategy as it continues to pioneer new possibilities for marketing automation through the introduction of generative AI.

What is Zeta Global (ZETA) and what is its business?

Zeta Global Holdings Corp. (ticker: ZETA), headquartered in New York, USAData-driven cloud marketing company.
Consumer intelligence and marketing automation software for businessesand support the marketing activities of clients.

The company's flagship product, Zeta Marketing Platform (ZMP), is an omni-channel marketing platform with identity data at its core.
ZMP is,Analyze structured and unstructured data and leverage machine learning algorithms and opt-in datasets to predict consumer intent.
Companies can deliver personalized marketing across a variety of channels, including email, social media, web, chat, connected TV (CTV), and video.

Zeta Global is,The company serves corporate clients in a wide variety of industries, including financial services, insurance, telecommunications, automotive, travel and hospitality, and retail.
What are the company's strengths?Advanced marketing solutions utilizing proprietary data assets and AI technologyand differentiates itself from its competitors.

In recent years, Zeta Global has focused on enhancing its AI capabilities, including a partnership with Amazon's Bedrock platform and the launch of the Zeta Economic Index (ZEI).
These efforts are expected to further enhance the company's technological capabilities and competitiveness in the market.

Zeta Global's company information is below.

• Company Name:: Zeta Global Holdings Corp.
• Date of Establishment: 2007
• Head Office LocationNew York, New York, U.S.A.
• Name of Representative:: David A. Steinberg, Ph.
• Official Site: https://www.zetaglobal.com/
• Main Businesses: Provider of consumer intelligence and marketing automation software. Provides a platform for companies to achieve omnichannel, personalized marketing.

What are Zeta Global's (ZETA) main products and services?

Zeta Global Holdings' flagship product is the Zeta Marketing Platform (ZMP).
ZMP is an integrated platform that enables companies to strengthen relationships with their customers and develop effective marketing activities.

Zeta Marketing Platform (ZMP) Key Features

• Data Integration and Analysis:. Integrate information from diverse data sources to gain a deep understanding of customer behavior and preferences.
• AI-Driven Insights:. Utilize machine learning algorithms to predict customer intent and future behavior.
• Omni-channel support:. Centrally manage marketing activities across multiple channels, including email, social media, web, chat, connected TV (CTV), and video.
• Personalized Marketing:. Provide optimized messages and offers to each customer to increase engagement.

These features enable companies to strengthen customer relationships and maximize the effectiveness of their marketing activities.

What is Zeta Global's (ZETA) business model?

Zeta Global Holdings' business model is to provide a data-driven, cloud-based marketing platform to support companies' marketing activities.

Main Revenue Sources

• Software license revenue Subscription fees for the use of the Zeta Marketing Platform (ZMP).
• Professional services revenue Revenue from providing services such as platform implementation support, customization, and consulting.
• Media services revenue Revenues are generated through support for the planning and operation of client companies' advertising campaigns.

Business Model Features

• Data Utilization:. Utilizes proprietary data assets and AI technology to analyze customer behavior and preferences.
• Omni-channel support:. Centralized management of marketing activities across multiple channels, including email, social media, web, chat, connected TV (CTV), and video.
• Personalized Marketing:. Provide optimized messages and offers to each customer to increase engagement.

By combining these elements, Zeta Global has created a business model that helps companies improve marketing efficiency and increase revenues.

Who is Zeta Global's (ZETA) customer base?

Zeta Global Holdings' clientele consists of companies across diverse industries.
Major industries include financial services, insurance, telecommunications, automotive, travel and hospitality, and retail.

The company provides consumer intelligence and marketing automation software to companies in these industries to help them enhance customer engagement and optimize marketing activities.

What are the "50 Laws" of Zeta Global's growth potential?

Zeta Global's growth potential "Rule of 50" is a measure of a company's sales growth rate and adjusted EBITDA rate, which should total at least 50%.

This law is widely used as a criterion for determining whether a company has achieved a balance between growth rate and profitability.

Zeta Global met this rule for the first time in the second quarter of 2024 with a 33% year-on-year increase in sales and a 44% increase in adjusted EBITDA.
The company is recognized for achieving sustainable growth while maintaining a healthy balance between both growth and profitability.

How is AI technology used in Zeta Global's products and services?

Zeta Global is,Leveraging AI Technology to Enhance Marketing SolutionsThe company is doing so. The company's Zeta Marketing Platform (ZMP) uses machine learning algorithms to analyze customer data and predict consumer behavior and preferences.

Companies will be able to develop personalized marketing campaigns and increase customer engagement.

In addition, Zeta Global isDeveloped new tools using generative AI to provide AI solutions for mobile marketingThe company is doing so.
These tools help marketers integrate AI across all touch points, including mobile, to execute effective marketing strategies.

Also,The company publishes the Zeta Economic Index (ZEI), which measures the health of the U.S. economy based on proprietary data and generative AI.
The index tracks online and offline consumer behavior and measures interest and willingness to purchase in areas such as automobiles, food and beverage, financial services, healthcare, and travel.

Through these efforts, Zeta Global is leveraging AI technology to increase the accuracy and effectiveness of its marketing solutions and support the marketing activities of its clients.

What is Live Intent, Inc. acquired by Zeta Global (ZETA)?

LiveIntent is an American marketing technology company founded in 2009.
The company specializes in people-based marketing technology, primarily email, and provides a platform for connecting advertisers and publishers.

Live Intent's technology leverages more than 235 million unique hashed email addresses per month, enabling targeted advertising based on consumer behavioral data.

In October 2024, Zeta Global agreed to acquire Live Intent for $250 million.
With this acquisition, Zeta Global aims to integrate Live Intent's data assets and publisher network to enhance its AI-driven marketing platform.

What is the trading market?

Zeta Global Holdings (ZETA) is listed on the New York Stock Exchange (NYSE).

What are the sectors, industries, and themes to which Zeta Global (ZETA) belongs?

sector

Technology Zeta Global is a company in the technology sector. The company offers a data-driven, cloud-based marketing platform to assist companies in their marketing efforts.

type of industry

EDP (Electronic Data Processing) Services:.Zeta Global is classified as an Electronic Data Processing (EDP) services industry. Specifically, the company provides consumer intelligence and marketing automation software, and develops data analysis and marketing solutions to help companies enhance customer engagement.

Themes belonging to

Zeta Global is concerned with the following topics

• AI and Data Analysis:. The company utilizes machine learning algorithms to predict consumer intent and deliver personalized marketing.
• Digital Marketing:. The company offers omni-channel marketing that centralizes marketing activities across multiple channels, including email, social media, web, chat, connected TV (CTV), and video.
• Cloud Solutions:. Through its cloud-based platform, the company streamlines corporate marketing activities and provides scalability and flexibility.

Through these themes, Zeta Global supports companies' digital marketing strategies and helps them improve customer engagement.

Dividends?

Zeta Global (ZETA) does not currently pay a dividend.

Who are Zeta Global's (ZETA) competitors?

Zeta Global's (ZETA) main competitors are.

• Adobe [ADBE]:.Through the Adobe Experience Cloud, Adobe offers digital marketing and customer experience management solutions.
  Like Zeta Global, it supports data-driven personalized marketing and improved customer engagement, and competes in the areas of marketing automation and analytics tools.
• Salesforce.com [CRM]:.Salesforce offers cloud-based CRM solutions, including the Salesforce Marketing Cloud.
  It competes directly with Zeta Global in integrated customer data management, personalization, and marketing automation capabilities.
• Oracle [ORCL]:.Oracle offers integrated marketing solutions through the Oracle Marketing Cloud.
  The company focuses on data management platforms (DMPs) and customer experience optimization, and is competing with Zeta Global for market share.
• IBM [IBM]:.IBM offers AI-driven marketing solutions through IBM Watson Marketing. It competes with Zeta Global in marketing optimization using machine learning and data analytics.
• Hub spot [HUBS]:.Hubspot offers a cloud-based platform that provides integrated software for marketing, sales, and customer service. The company's customer relationship management (CRM) system helps companies centrally manage customer relationships, marketing automation, sales pipeline management, and customer support efficiency.
  It offers an easy-to-use interface and flexible functionality, especially for small and medium-sized businesses, and like Zeta Global, competes in the digital marketing field.

What is the size and growth potential of the industry to which Zeta Global (ZETA) belongs?

The digital marketing industry, of which Zeta Global is a part, has experienced rapid growth in recent years.
Global market size reached $410.7 billion in 2024 and is projected to expand at a compound annual growth rate (CAGR) of 11.221 TP3T from 2025 to 2033, reaching $1,1895 billion by 2033The company has been

In Japan, the digital marketing market is also expanding.
The market size is estimated at 301.99 billion yen in 2023 and is expected to grow to 344.25 billion yen in 2024, an increase of 14.01 TP3T from the previous year.

In particular, CRM (Customer Relationship Management) and MA (Marketing Automation) tools are being introduced, and their use by small and medium-sized companies is increasing.

In this market environment,Zeta Global provides marketing solutions that leverage its unique data assets and AI technology to increase its competitiveness.
The company's growth is closely tied to the expansion of the digital marketing industry as a whole.

What are Zeta Global's (ZETA) differentiators and advantages over the competition?

Zeta Global differentiates itself from its competitors by leveraging its unique data assets and advanced AI technology.

differentiator

• Unique data assets:. Zeta Global has more than 250 million consumer profiles and uses this data for precise targeting and personalized marketing.
• AI-driven marketing platform:. The company's Zeta Marketing Platform (ZMP) uses machine learning algorithms to predict consumer behavior and propose optimal marketing initiatives.
• Omni-channel support:. Provide an integrated customer experience by centrally managing marketing activities across multiple channels, including email, social media, web, chat, connected TV (CTV), and video.

competitive edge

• Highly accurate targeting Abundant data and AI technology enable accurate understanding of customer needs and behavior, and the development of effective marketing initiatives.
• Scalability: The The cloud-based platform allows for flexible, rapid deployment and expansion regardless of the size of the company or industry.
• Integrated solutions:. Provide consistent services from data collection to analysis and execution of measures to improve the efficiency of corporate marketing activities.

These factors differentiate Zeta Global from its competitors and give it a strong position in the marketing arena.

Zeta Global (ZETA) Financial Results

Zeta Global Holdings' financial year ends on December 31.
The company's quarterly earnings announcement schedule is as follows.

• 1Q Results: (1) Early May
• 2Q Results: (1) Consolidated Early Aug.
• 3Q Results: (1) Early Nov.
• 4th quarter and full year results: (1) Late February of the following year

We will review the following four indicators to analyze Zeta Global's (ZETA) minimum performance.

1. Sales:An indicator of a company's performance and growth.
2. Operating cash flow and operating cash flow margin:An indicator that looks at how much cash a company generates from its services. Margins are considered excellent when they are 15% of that ratio.
3. Operating Income:Profit earned by a company from its core business. An indicator to evaluate a company's performance.
4. Free Cash Flow:Free cash that a company keeps on hand. Indicates financial flexibility and business stability.
5. EPS:An indicator that looks at a company's earning power "profitability" and "growth potential" in terms of net income per share. The higher the number, the higher the profitability.

Each data is,Investing.com, ,TradingViewSee from

Zeta Global (ZETA) Stock Price

View the current real-time stock price chart (TradingView) for Zeta Global (ZETA).

The chart shows the Relative Strength Index (RSI). Reference as an indicator of market overheating.

*An overbought indicator when the RSI exceeds 70% to 80%, and conversely, an oversold indicator when the RSI falls below 20% to 30%.

Zeta Global (ZETA) Quarterly: Sales Trends

Quarterly sales forecasts and actual sales and year-on-year changes.

Sales forecasts and actual results are shown in graphs.

Zeta Global (ZETA) Quarterly: Operating Cash Flow and Free Cash Flow Trends

Quarterly operating cash flow, operating cash flow margin and free cash flow.

Each transition is shown in the graph below.

Zeta Global (ZETA) Quarterly: Operating Income and Operating Margin Trends

Quarterly operating income and operating margin trends.

Each transition is shown in the graph below.

Zeta Global (ZETA) Quarterly: EPS Trends

Quarterly EPS forecast and actual EPS.

Each transition is shown in the graph below.

Zeta Global (ZETA) Full Year: Sales Trends

This is the sales forecast for the full year and actual sales and year-on-year changes.

Each transition is shown in the graph below.

Celestica (CLS) Full Year: Operating Cash Flow, Free Cash Flow Trends

Operating cash flow, operating cash flow margin and free cash flow for the full year.

Each transition is shown in the graph below.

Zeta Global (ZETA) Full Year: Operating Income and Operating Margin Trends

The following is a trend of operating income and operating income margin for the full year.

Each transition is shown in the graph below.

Zeta Global (ZETA) Full Year: EPS Trends

This is the EPS forecast and actual EPS for the full year.

Each transition is shown in the graph below.

What is the future life and outlook for Zeta Global (ZETA)?

Zeta Global Holdings is a data-driven, cloud-based marketing platform company with promising prospects based on recent performance and market trends.

Performance and Growth Potential

In the second quarter of 2024, Zeta Global showed solid growth with a 33% increase in sales and a 44% increase in adjusted EBITDA over the same period last year.
As a result, the company has achieved the "Rule of 50" (the sum of sales growth and adjusted EBITDA ratio of 50% or more) for the first time, demonstrating a good balance between growth and profitability.

Market Valuation and Stock Price Outlook

Analysts are highly impressed with Zeta Global's growth potential and are raising their price targets for the company. These ratings reflect the company's sustained growth and competitiveness in the market.

Future Prospects

Zeta Global is leveraging its unique data assets and AI technology to strengthen its leadership in the marketing automation field.
The company is also active in technological innovation, developing new tools using generative AI and providing AI solutions for mobile marketing.
These initiatives are expected to enhance the company's competitive advantage and support future growth.

In general, Zeta Global is regarded as a company with strong future prospects, backed by solid performance and aggressive technological development.
However, the marketing technology sector continues to be highly competitive and requires flexibility to respond to market trends and the speed of technological innovation, so it will require continued close monitoring.

Zeta Global (ZETA) Q2 2024 Financial Results Summary

Date of announcement: 24/08/01

Sales and Revenues

• Net sales: $228.39M, up $33% YoY; strong demand for AI-powered marketing cloud, especially from enterprise customers.
• Growth of customer base: The number of highly profitable customers (Scaled Customers) increased to 468, and revenue per customer (ARPU) was $479,000, up $22% YoY.
• GAAP net loss: $28.06 million, an improvement from the loss in the same period last year. The loss margin has narrowed, with a loss per share of $0.16.

Cash Flow

• Operating Cash Flow: $31.11 million, an increase of 511 TP3T over the same period last year. Free cash flow also reached $20 million, maintaining stable cash flow.

Improved Profitability

• Adjusted EBITDA: Adjusted EBITDA was $38.54 million, an increase of 441 TP3T over the same period last year. Adjusted EBITDA margin was 16.91 TP3T, with efficient operations underway.

Growth Measures and Events

• Enhanced AI-enabled marketing cloud: The introduction of generative AI tools has further accelerated the use of AI in the marketing field. This has resulted in personalization and improved ROI for customers.
• Zeta Live 2024: The company plans to hold a "Zeta Live 2024" event in September, a place to share insights on the latest trends in AI and its application to marketing, strengthening its presence in the industry.

Future Guidance

• Third Quarter Forecast: Sales are expected to reach $237.2M to $241.2M, an increase of 26-281 TP3T over the same period last year. Adjusted EBITDA is also projected to increase from $46.8 million to $47.3 million.
• Year-round guidance: Sales are expected to be between $920M and $930M, with projected growth of 26-28% YoY. Adjusted EBITDA is expected to reach $174.5M to $176.5M, with improved cash flow.

Zeta Global is leveraging AI technology and data to expand its share of the marketing automation market.

Zeta Global (ZETA) Q3 2024 Financial Results Summary

Date of announcement: 24/11/12

Sales and Revenues

• Net sales: $268.3 million (+421 tp3t y/y).
• net loss: $17.37 million (improved from $43.08 million in the same period of the previous year).
• Revenue by Segment:
  • U.S. market: $261.5 million (971 TP3T of total sales).
  • International markets: $6.8M (31 TP3T of total sales).

Costs and Expenses

• operating expensesUS$280.7 million (up from US$226.2 million in the same period of the previous year).
  • R&D expenses increased significantly from the same period last year to $22.8 million.
  • Marketing and sales expenses: $84.5 million.
• Stock compensation expense47.2 million (down from $57.7 million in the same period of the previous year).

Cash Flow

• Cash flows from operating activities: $90.2 million (a significant increase over the same period last year).
• Investment ActivitiesThe overall spend was $29.6 million, including a $12.1 million investment in software development.

Future Guidance and Key Points

1. growth strategy:
   • The company plans to further increase revenues by expanding its customer base.
   • Focus on introducing new products that utilize AI technology.
2. competitive edge:
   • Platform revenue accounted for 701 TP3T of the total, clearly strengthening the direct sales channel.
3. financial soundness:
   • Improved cash flow improves the company's ability to repay long-term debt.

Implications for Investors

• The third quarter was marked by strong sales growth and a narrowing of the deficit.
• While revenues increased, operating expenses also increased, and the focus will be on improving profitability.
• The use of AI and platform technology is the key to increasing a company's competitiveness.

This financial report shows growth potential, but emphasizes that cost control and improving profitability remain challenges.

What are the factors behind Zeta's (ZETA) significant share price decline after Q3 results?

Factors behind the decline in stock prices

In the third quarter results, earnings per share (EPS) fell below market guidance, causing a temporary decline in the stock price. A report released by short-seller Culper Research followed, leading to a significant drop in the stock price. The report questioned Zeta's financial condition and the transparency of its use of data.

Zeta Response

Zeta refuted Short Seller's claims through timely disclosure. By announcing a share buyback program, the company clearly demonstrated its commitment to increasing shareholder value.

Main Points

Sales and Revenues

Zeta Global continues to grow with its AI-based marketing platform. While no specific revenue data for the third quarter was mentioned, the company emphasized that its business strategy is strong, and expressed confidence in expanding its revenue base based on AI technology and data utilization.

Response to Short Seller

Zeta refutes Short Seller's claim as follows.

• Financial soundness: (1) Presented an unqualified opinion of Deloitte, an independent auditing firm, and insisted on transparency in financial reporting.
• Internal Controls:. Clearly state the strengthening of internal processes and promote understanding of inaccuracies noted.
• Legal Compliance:. Explains compliance with data collection and privacy regulations and notes reporting bias.

stock repurchase program

On November 13, 2024, Zeta announced a stock repurchase program worth up to $100 million and announced its intention to proceed with market repurchases by the end of 2026. The intention is to use the excess cash flow to increase shareholder value.

Increased orders and accelerated growth

Although no specific order growth data was mentioned, Zeta expressed confidence in accelerating growth beyond 2024. The company has indicated plans to pursue a long-term growth strategy to expand its customer base.

Cash Flow Forecast

According to the CFO's statement, the company expects to generate hundreds of millions of dollars in free cash flow over the next two years. The company plans to use these funds for stock buybacks and growth strategies to increase corporate value.

Future Guidance

Zeta aims to increase revenue growth and data utilization efficiency through further evolution of its AI marketing platform. In the short term, the pace of growth is expected to accelerate from Q4 2024 through 2025 and beyond.

Which brokerage firms can I buy shares of Zeta Global (ZETA)?

The following is a list of major brokerages that offer Zeta Global (ZETA) shares. At these brokerages, you can choose to invest as a CFD (Contract for Difference) as well as directly as a foreign stock.

I myself mainly use SBI Securities, but some stocks they handle may not be available for purchase. In such cases, I sometimes use CFDs at Saxo Bank Securities or IG Securities.

summary

We have taken an in-depth look at Zeta Global Holdings' business, its unique strengths, competitive advantages, and earnings growth.

The company's performance data confirms solid growth, and the company is in a phase where it is expected to move into the black and accelerate the speed of profit growth.

Faced with a difficult situation in which a report by the short sellers caused a significant drop in the stock price, Zeta responded quickly and positively by immediately rebutting the report and announcing a share buyback program. The company's commitment to protecting and enhancing shareholder value is admirable.

Personally, my strategy is to pick up the pieces when they fall, and I will continue to focus on the company's competitive advantage in growth areas.