Earnings Update: Zeta Global Holdings Corp. (NYSE:ZETA) Just Reported Its Third-Quarter Results And Analysts Are Updating Their Forecasts

Shareholders of Zeta Global Holdings Corp. (NYSE:ZETA) will be pleased this week, given that the stock price is up 10% to US$8.45 following its latest quarterly results. The business exceeded expectations with revenue of US$189m coming in 5.7% ahead of forecasts. Statutory losses were US$0.27 a share, in line with what the analysts predicted. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Zeta Global Holdings

After the latest results, the nine analysts covering Zeta Global Holdings are now predicting revenues of US$849.2m in 2024. If met, this would reflect a sizeable 22% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 52% to US$0.46. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$838.0m and losses of US$0.37 per share in 2024. While next year's revenue estimates held steady, there was also a regrettable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

As a result, there was no major change to the consensus price target of US$14.22, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Zeta Global Holdings analyst has a price target of US$21.00 per share, while the most pessimistic values it at US$11.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Zeta Global Holdings' revenue growth is expected to slow, with the forecast 18% annualised growth rate until the end of 2024 being well below the historical 23% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 12% per year. So it's pretty clear that, while Zeta Global Holdings' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$14.22, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Zeta Global Holdings analysts - going out to 2025, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Zeta Global Holdings , and understanding it should be part of your investment process.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.