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Investing.com - Needham raised its price target on Zeta Global Holdings Corp (NYSE:ZETA) to $25.00 from $20.00 on Wednesday, while maintaining a Buy rating on the marketing technology company’s stock. Currently trading at $19.87, Zeta has shown strong momentum with a 41.6% return over the past six months. According to InvestingPro data, analysts maintain a bullish consensus with price targets ranging from $18 to $34.
The price target increase follows Zeta’s announcement on Tuesday regarding its pending acquisition of Marigold’s enterprise marketing software business for $325 million, representing approximately 1.7 times EV/Revenue and less than 10 times EV/Adjusted EBITDA.
Needham views the acquisition positively, citing expanded geographic reach and compelling cross-selling opportunities, while noting the purchase price is not expensive relative to the business being acquired.
The firm highlighted potential cost synergies that could make the acquisition financially beneficial, suggesting Zeta’s operational strengths could improve the performance of the acquired business.
Needham also acknowledged some cautionary aspects of the deal, including inherent risks in cross-selling to customers not currently using Zeta solutions, and the low growth rate of the acquired business, which might indicate either management execution issues or potential product competitiveness concerns.
In other recent news, Zeta Global announced its plan to acquire Marigold’s enterprise software business for up to $325 million. This acquisition will expand Zeta’s customer base with over 100 global enterprise brands and includes units like Marigold Loyalty and Cheetah Digital. The transaction is expected to close by the end of 2025, pending customary conditions. Following this announcement, Canaccord Genuity raised its price target for Zeta Global to $30, maintaining a Buy rating, while DA Davidson increased its target to $27, also keeping a Buy rating. Truist Securities reiterated its Buy rating with a $34 price target after meetings with Zeta’s management, which discussed the company’s long-term growth strategy and AI initiatives. Additionally, Zeta Network Group completed a $6.4 million direct offering, selling shares and warrants to institutional investors. These developments reflect ongoing strategic moves by Zeta to enhance its market position and growth potential.
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