Advertising and marketing company Zeta Global (NYSE:ZETA) will be reporting results tomorrow afternoon. Here’s what you need to know.
Zeta beat analysts’ revenue expectations by 7.1% last quarter, reporting revenues of $268.3 million, up 42% year on year. It was an exceptional quarter for the company, with an impressive beat of analysts’ billings estimates and EBITDA guidance for next quarter exceeding analysts’ expectations.
Is Zeta a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Zeta’s revenue to grow 40.3% year on year to $295 million, improving from the 20.1% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.22 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Zeta has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 5.7% on average.
Looking at Zeta’s peers in the advertising software segment, some have already reported their Q4 results, giving us a hint as to what we can expect. AppLovin delivered year-on-year revenue growth of 44%, beating analysts’ expectations by 8.6%, and LiveRamp reported revenues up 12.4%, topping estimates by 1.7%. AppLovin traded up 24.1% following the results while LiveRamp was also up 2.7%.
Read our full analysis of AppLovin’s results here and LiveRamp’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the advertising software stocks have shown solid performance, the group has generally underperformed, with share prices down 3% on average over the last month. Zeta is up 15.1% during the same time and is heading into earnings with an average analyst price target of $36.92 (compared to the current share price of $21.27).
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