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# Zeta Global: Cautious Due To Unfavorable Growth Composition And Pricey M&A (Archive)
- URL: https://www.huntingalphas.com/zeta-global-cautious-due-to-unfavorable-growth-composition-and-pricey-m-a-archive/
- Published: 2024-12-30T09:15:00.000Z
- Updated: 2026-02-28T08:04:38.000Z
- Description: Strong growth, ARPU-led expansion, pricey M&A and fair valuation drive a cautious Hold.
- Author: Vish (Hunting Alphas)
- Tags: 5-Minute Pitches, #noindex, Archive, #sa-origin, ZETA, Tech

*This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.*

## Elevator Pitch

- Growth is undoubtedly strong, but it is driven more by ARPU-mining of existing clients. New accounts growth trends are seeing a deceleration.
- There is ample scope for margin expansion at the GAAP-EBIT, driven by operating leverage effects. This is evident from the 37% YoY incremental EBIT margins.
- Zeta paid a consideration of 5.8x EV/Revenues for LiveIntent, significantly above the 2024 SaaS median EV/Revenue transaction multiple of 2.8x, and within the highest 4th quartile of transaction comps too.
- Valuations are close to fair value levels when looking at ZETA's typical discount 13.9% vs peers as a baseline. Technically, vs SPX 500, bearish momentum fights a key support level.
- Declining RPOs, which are a leading indicator of revenues, are a demand risk monitorable. There is a potential silver lining here that RPOs may increase following good conversions of an impressive 60% QoQ growth in requests for proposals.

Read the full article [here](https://seekingalpha.com/article/4746881-zeta-global-cautious-unfavorable-growth-composition-pricey-m-and-a?ref=huntingalphas.com).

#### Disclosures and Disclaimers

**Past performance ≠ future results. Not investment advice. See* [**full Disclaimer*](https://www.huntingalphas.com/disclaimer/)**.*