• If you are wondering whether Zeta Global Holdings at around US$16.25 is a bargain or already pricing in the story, this article walks through what the current valuation signals are really telling you.
• The stock has been volatile recently, with the share price down 9.0% over the last week, up 11.2% over the last month, and showing a 9.0% return over the past year alongside a very large 3 year gain of 101.1%, while the year to date performance is down 18.4%.
• These swings sit against a backdrop of ongoing interest in software and marketing technology stocks. Investors often focus on growth potential, profitability and balance sheet strength. For Zeta Global Holdings, that attention has put the spotlight on whether its current price properly reflects its fundamentals and risk profile.
• On Simply Wall St’s valuation framework, Zeta Global Holdings currently has a value score of 5 out of 6. The next sections will walk through the standard valuation checks before finishing with a broader way to think about what this score really means for you.

Approach 1: Zeta Global Holdings Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model takes estimates of the cash a company could generate in the future and discounts those amounts back to today, using a required rate of return, to arrive at an estimate of what the business might be worth now.

For Zeta Global Holdings, the model uses a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month free cash flow is about $165.6 million. Analysts provide free cash flow estimates for the next few years, and Simply Wall St then extrapolates further. In this case, projected free cash flow reaches $503.2 million in 2035, with interim years such as 2026 at $235.1 million and 2027 at $284.9 million, all in $. These projected cash flows are discounted back and summed to produce an estimated intrinsic value per share.

That DCF output suggests a fair value of about $27.49 per share. Based on this estimate, the stock is trading at a 40.9% discount to the model’s fair value.

Result: UNDERVALUED (according to this DCF model)

Our Discounted Cash Flow (DCF) analysis suggests Zeta Global Holdings is undervalued by 40.9%. Track this in your watchlist or portfolio, or discover 45 more high quality undervalued stocks.

Approach 2: Zeta Global Holdings Price vs Sales

For companies where investors often focus on revenue growth and scale, the P/S ratio is a useful anchor because it compares the stock price to the sales the business generates, regardless of current earnings levels.

What counts as a reasonable P/S multiple usually reflects how the market views a company’s growth potential and risk profile. Higher expected growth or perceived resilience can support a higher P/S, while higher risk or weaker growth prospects tend to justify a lower one.

Zeta Global Holdings currently trades on a P/S ratio of 2.82x. This is below both the Software industry average of 3.58x and the peer group average of 3.62x, which suggests the stock is priced more conservatively than many comparable software companies.

Simply Wall St’s Fair Ratio for Zeta Global Holdings is 4.23x. This proprietary metric estimates what a reasonable P/S could be, given factors such as earnings growth, profit margins, industry, market cap and company specific risks. Because it adjusts for these elements, it can be more informative than a simple comparison with industry or peer averages.

Comparing the Fair Ratio of 4.23x with the current 2.82x P/S indicates the stock is trading below this model based reference level.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your Zeta Global Holdings Narrative

Earlier it was mentioned that there is an even better way to understand valuation, so Narratives are introduced here as simple stories you build around the numbers, where you connect your view of Zeta Global Holdings to specific assumptions for future revenue, earnings and margins, and then to a fair value that you can compare with the current share price.

On Simply Wall St’s Community page, Narratives are available as an easy tool that lets you do exactly this. They update automatically when fresh information such as news or earnings is added, so your story and fair value stay aligned with the latest data.

For example, one Zeta Global Holdings Narrative might lean closer to the bullish fair value of about US$39.26 that assumes higher revenue growth, margins and a 55.8x future P/E. Another might sit nearer the bearish fair value of US$23.00 that uses lower margins and a 44.0x future P/E. By seeing these side by side you can decide which story best matches your expectations and how that compares with the current price.

Do you think there's more to the story for Zeta Global Holdings? Head over to our Community to see what others are saying!

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.