On Tuesday, Truist Securities adjusted its outlook on Zeta Global Holdings Corp (NYSE: ZETA), increasing the price target to $42.00 from the previous $35.00, while reiterating a Buy rating on the stock. The firm's decision came after Zeta Global reported third-quarter earnings for 2024 that exceeded expectations set in September.
The company's financial performance demonstrated significant growth, with year-over-year revenue expansion reaching 28%, adjusted from the previously anticipated 25%. This uptick was attributed to robust scaled customer Average Revenue Per User (ARPU) growth, which was in the mid-20% range excluding political candidate revenue, a record achievement for the company.
Additionally, Zeta Global saw a quarter-over-quarter increase of 25% in scaled brands and a remarkable year-over-year growth of 29% in super scaled brand revenue.
Direct revenue for Zeta Global grew by 41% compared to the same period last year, and the agency holding company business now represents a mid-teens percentage of total revenue, with a 60% surge in the Request for Proposal (RFP) pipeline over the past three months. These factors contributed to the analyst's optimistic view of the company's growth trajectory.
The raised price target is also based on higher Discounted Cash Flow (DCF) assumptions, reflecting the analyst's confidence in Zeta Global's sustained growth profile, excluding the impact of political candidate revenue and the assumed contribution from LiveIntent.
The analyst's commentary emphasized the company's structurally improved growth profile, which remains well intact, supporting the rationale behind the maintained Buy rating and the increased price target.
In other recent news, several analyst firms have acknowledged this growth. Oppenheimer, for example, has raised its price target for Zeta Global to $42, while maintaining an Outperform rating. Similarly, Needham increased its price target for the company to $43. RBC Capital, Barclays (LON:BARC), and DA Davidson also raised their price targets, reflecting confidence in Zeta Global's ability to continue its growth trajectory.
The company's growth has been attributed to strategic acquisitions, key contracts, partnerships, and an increased focus on AI-driven marketing solutions. Zeta Global's management has also expressed optimism about the company's future performance and market position, indicating a positive outlook for the firm's financial growth and stability.
These recent developments underscore Zeta Global's continued growth and solidifying market position.
InvestingPro Insights
Zeta Global Holdings Corp's recent performance aligns with several InvestingPro metrics and tips, providing additional context to the analyst's optimistic outlook. The company's revenue growth of 32.61% in Q2 2024 supports Truist Securities' observation of robust expansion. This growth is further reflected in Zeta's impressive market performance, with a 345.87% price return over the past year and a 132.53% return over the last six months.
InvestingPro Tips highlight that 3 analysts have revised their earnings upwards for the upcoming period, aligning with the positive sentiment expressed in the article. The stock is also trading near its 52-week high, with a price that is 96.18% of its 52-week peak, indicating strong market confidence.
While Zeta Global is not currently profitable over the last twelve months, InvestingPro Tips suggest that analysts predict the company will be profitable this year. This projection aligns with the company's improving financial metrics and the analyst's raised price target.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Zeta Global Holdings Corp, providing a deeper understanding of the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.