Zeta Global Holdings Outperforms in Challenging Software Earnings Season

Barclays's Ryan Macwilliams raised their price target on Zeta Global Holdings (NYSE: ZETA) by 20% from $15 to $18 on 2024/05/07. The analyst maintained their Strong Buy rating on the stock.

In an assessment of Zeta Global Holdings' Q1 2024 earnings report, Macwilliams highlighted the company's impressive performance in a challenging software earnings season. According to the analyst, Zeta Global Holdings stood out with a "big beat and raise" quarter, positioning the company for further gains in 2024. Macwilliams specifically noted the company's enterprise emphasis and leverage towards political expenditure as factors that could contribute to its success.

For the first quarter of 2024, Zeta Global Holdings reported a loss per share of $0.23, missing the Zacks Consensus Estimate of $0.08. However, it still exceeded the previous year's Q1 loss of $(0.38) by 39.5%. The company's revenue for the quarter reached $194.9 million, surpassing the Zacks Consensus Estimate of $187.1 million and showing a 24% increase compared to Q1 2023. Zeta Global Holdings also demonstrated growth in other key areas, including a 27% year-over-year increase in EBITDA and a 50% increase in free cash flow.

Looking ahead, Zeta Global Holdings' management provided guidance for the second quarter of 2024 and the full fiscal year. For Q2 2024, the company expects revenue in the range of $210 million to $214 million and EBITDA in the range of $35.3 million to $35.8 million. The guidance also includes a projected EBITDA margin of 16.5% to 17.0%. For the full fiscal year 2024, Zeta Global Holdings anticipates revenue between $895 million and $905 million, EBITDA between $170 million and $172 million, and an EBITDA margin of 18.8% to 19.2%. The company also expects free cash flow to be in the range of $75 million to $85 million.

Co-Founder, Chairman & CEO David A. Steinberg expressed confidence in the company's future outlook, citing the actionable intelligence delivered by the Zeta Marketing Platform as a driving force behind the acceleration in their business. Steinberg emphasized the demand for modern marketing technology platforms that leverage artificial intelligence to drive growth and improve operational efficiency while prioritizing data protection. CFO Chris Greiner added that Zeta Global Holdings had a strong start to the year, with increased visibility from new customer wins and the expansion of existing customer relationships.

In addition to Barclays's Ryan Macwilliams, other analysts also updated their ratings on Zeta Global Holdings on May 7, 2024. Elizabeth Porter of Morgan Stanley raised their price target by 5.9% from $17 to $18 while maintaining a Strong Buy rating on the stock. Jason Kreyer of Craig-Hallum raised their price target by 46.7% from $15 to $22 and maintained a Buy rating. Koji Ikeda of Bank of America raised their price target by 20% from $15 to $18 and also maintained a Strong Buy rating.

Overall, 80% of top-rated analysts currently rate Zeta Global Holdings as a Strong Buy or Buy, while the remaining 20% see it as a Hold. No analysts recommend or strongly recommend selling the stock.

Since Zeta Global Holdings' latest quarterly report on May 6, 2024, the stock price has risen by 18.3%. Year-over-year, the stock has experienced significant growth, with an increase of 86%. During this period, Zeta Global Holdings has outperformed the S&P 500, which has seen a 25.4% increase.

Barclays analyst Ryan Macwilliams, who raised the price target on Zeta Global Holdings, is ranked in the top 14% of Wall Street analysts by WallStreetZen. With an average return of 12.2% and a win rate of 56.4%, Macwilliams specializes in the Communication Services and Technology sectors.

Zeta Global Holdings Corp. is a company that provides consumer intelligence and marketing automation software. Its flagship product, the Zeta Marketing Platform, utilizes machine learning and opted-in data sets to analyze data points and predict consumer intent. The company's Consumer Data platform generates a comprehensive view of a consumer, including identity, profile characteristics, behaviors, and purchase intent. Zeta Global Holdings also offers product suites such as Opportunity Explorer and CDP+ that consolidate multiple databases and organize data based on specific needs and performance metrics. The company was incorporated in 2007 and is headquartered in New York, NY.

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