ZETA's Bold Move: Share Buyback Plan Boosts Stock After Short-Seller Report

In an unexpected turn of events, Zeta Global (NYSE: ZETA) has seen its stock surge over 20% in pre-market trading, following a 50% decline over the past two days. The remarkable rebound can be attributed to the company's announcement of a $100 million share buyback plan, which is believed to be a direct response to a recent short-seller report.

Culper Research, a short-seller, published a report on November 13, 2024, alleging accounting irregularities and inflated revenue at Zeta Global. The report sent Zeta's stock price tumbling, as investors reacted to the perceived risks. However, the company swiftly responded, refuting the report's claims and expressing confidence in its internal accounting processes and controls.

Zeta's share buyback plan, authorized through December 31, 2026, signals management's confidence in the company's long-term potential and undervalued stock price. The program, combined with Zeta's positive financial results, indicates that the company is committed to enhancing shareholder value and addressing investor concerns.

Zeta's improved financial performance, as reflected in its first-quarter results, has also contributed to the share price increase. The company reported a GAAP loss per share of 23 cents, beating market estimates of 25 cents, and quarterly sales of $194.947 million, topping estimates of $187.112 million. Additionally, Zeta Global increased its second-quarter revenue guidance, signaling confidence in its business outlook.



The share buyback plan, coupled with Zeta's positive financial results, demonstrates management's confidence in the company's future prospects. The buyback, authorized through December 31, 2026, signals a belief in ZETA's long-term potential and undervalued stock price. Additionally, ZETA's third-quarter revenue contribution of less than 3% from Apptness and ArcaMax, and the insignificant revenue generated by customer relationships that are also vendors, indicates a diversified business model. The company's positive financial results, including an unqualified opinion from independent auditors Deloitte, further cement management's confidence in ZETA's growth potential.



In conclusion, Zeta Global's share buyback plan, combined with its positive financial results, has instilled confidence in investors and contributed to a significant surge in the company's stock price. While the short-seller report initially raised concerns, Zeta's strategic response and commitment to enhancing shareholder value have helped to mitigate the negative impact and position the company for long-term growth.