Zeta Global Grows Fast but Dilution Lowers Fair Value
Feb 27, 2025
Zeta Global had a strong year, with revenue up 38%, large customer count rising 15%, and net revenue retention at 114%. Q4 was its best quarter yet, with nearly 50% sales growth. As a leader in AI-driven marketing, Zeta projects 20%+ annual growth, targeting $2 billion in revenue by 2028. However, new details impact fair value: management now expects a 16% free cash flow margin—below my 20% target—and has issued nearly 30 million shares for acquisitions and performance stock units, significantly diluting public shareholders. Accounting for these factors, our fair value drops to $18, aligning with its current trading price.
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Watch List
| CRWD | 113.61% |
| NTNX | 44.26% |
| VEEV | 13.93% |
| SNOW | 50.86% |
| WDAY | -9.43% |
| ENLT | -10.81% |
| WEAV | -27.40% |
| SE | 36.62% |
| SPSC | 12.33% |
| RDDT | 14.74% |
| APPF | 13.92% |
| CMG | 39.56% |
| INTU | 44.44% |
| PSTG | 12.28% |
vs. Fair Value Estimates
Buy List
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| ADBE | -39.09% |
vs. Fair Value Estimates
Hold List
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| MNDY | 18.12% |
| ZS | 81.90% |
| V | -2.80% |
| ADSK | 5.86% |
| NOW | 19.40% |
| ABNB | -23.85% |
| FTNT | -0.17% |
| TEAM | -15.16% |
vs. Fair Value Estimates