Usman Salis
⬤ Zeta Global Holdings Corp. (ZETA) is catching eyes for all the right reasons—except its stock price. The company trades at just 3.1x forward price-to-sales while cranking out 36 percent revenue growth year over year. The chart breaks down this mismatch by tracking Zeta's valuation multiple against its revenue performance over the past few years.
⬤ Zeta's revenue growth has stayed impressively consistent, bouncing between the low 20s and peaks above 38 percent before settling around 35.9 percent recently. Meanwhile, the forward P/S multiple has drifted lower. The data shows a 17.35 percent drop in the valuation metric even as revenues compounded at roughly 12.8 percent annually—a widening disconnect that's hard to ignore.
Companies with similar revenue growth rates often trade at meaningfully higher valuation multiples.
⬤ That's where things get interesting. The chart puts Zeta alongside peers with comparable growth profiles, and the difference is stark. Most companies posting these kinds of numbers command higher multiples. Zeta's lower valuation suggests investors remain wary—whether about competition, sustainability, or execution—even though the revenue story keeps delivering.
⬤ This gap matters because it shows how pricing can trail performance when doubt lingers. Zeta sits at a crossroads where the fundamentals point one way and the stock price another. How this plays out could shape sentiment across high-growth software stocks as investors recalibrate what's already baked into valuations.
Usman Salis
