What Happened?
Shares of advertising and marketing company Zeta Global (NYSE:ZETA) jumped 5.2% in the morning session after the company announced the acquisition of LiveIntent, which is expected to contribute to earnings and expand the capabilities of its platform.
Management added, "We already have interest from Zeta customers in our largest verticals for cross-selling opportunities, and we believe these synergies can accelerate LiveIntent's growth while continuing Zeta's strong organic growth rates."
Lastly, Zeta reaffirmed Q3 2024 guidance, indicating that the acquisition-related activities are not expected to have a major negative impact on its bottom line.
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What The Market Is Telling Us
Zeta’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock gained 21.8% on the news that the company reported first-quarter results that blew past analysts' billings, adjusted EBITDA, and free cash flow expectations. Notably, the company highlighted strengths in the number of scaled-up customers (from the $100,000 to $1 million cohort), leading to strong ARPU (average revenue per user) growth.
Looking ahead, next quarter's revenue guidance came in higher than Wall Street's estimates. On the other hand, its new large contract wins slowed. Overall, we think this was a strong quarter that should satisfy shareholders.
Zeta is up 301% since the beginning of the year, and at $33.64 per share, has set a new 52-week high. Investors who bought $1,000 worth of Zeta’s shares at the IPO in June 2021 would now be looking at an investment worth $3,787.
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