ZETA Loses 22% in a Year: Should You Buy, Sell or Hold the Stock?

Zeta Global Holdings Corp. ZETA stock lost 22% in a year against the industry's marginal rise and the Zacks S&P 500 composite's 18.3% growth.

1-Year Share Price Performance

Let us analyze this stock to find out whether investors should buy the stock, retain it, or sell it immediately.

Zeta Global & OpenAI Collaboration: A Watershed Moment

ZETA announced a strategic collaboration with OpenAI to power Athena, its superintelligent agent built for enterprise marketing, during CES 2026. This announcement is a seal of approval by OpenAI of Zeta’s AI capabilities. ZETA will enjoy the opportunity for early access to new OpenAI models and features supporting integration with the latest AI advancements. We anticipate that this collaboration will allow ZETA to launch features earlier than its competitors, who rely on public API releases.

David A. Steinberg, co-founder, chairman and CEO of the company, stated that this strategic collaboration is the most instrumental partnership among the many. This statement is certainly a validation to the investors, which is further solidified by the agentic nature of Athena, casting it as a powerful task executor. TKO Group Holdings, the early user of this platform, reported a visible reduction in report generation time.

The OpenAI engine will run on Zeta Global’s fuel, which is the data of more than 245 million U.S. adults held by Identity Graph. The lethal combination of OpenAI’s reasoning and Zeta Global’s enormous dataset will create a product that could be a one-of-a-kind AI tool, facilitating the company to gain a competitive edge.

ZETA’s Upbeat Profitability & Strong Balance Sheet

Return on equity (ROE), a measure of profitability, reflects how effectively a company uses its shareholders' investments to generate earnings. ZETA’s trailing 12-month ROE is 21.5%, outperforming the industry’s average of 15.6%. Such higher returns translate into the company’s effective self-funded expansion, reducing the need for external financing and strengthening its long-term value.

As of the end of September 2025, ZETA held $385 million in its cash chest compared with no current debt. It highlights the company’s strong liquidity, further bolstered by its current ratio of 3.01, significantly higher than the industry average of 1.59. A current ratio exceeding 1 ensures efficient coverage of short-term obligations.

ZETA’s Strong Growth Outlook vs. Cooling Analyst Sentiment

The Zacks Consensus Estimate for the company’s 2026 revenues is pegged at $1.7 billion, indicating 34.1% growth from the year-ago reported level. The consensus estimate for 2026 EPS stands at 99 cents, a 48.5% increase from the prior year's actual.

While the top- and bottom-line outlook appears strong, over the past 60 days, one 2026 EPS estimate has moved lower with no upward adjustment. During the same period, the Zacks Consensus Estimate for 2026 earnings has decreased by 4%. These downward revisions highlight a lack of analyst confidence.

Zeta Global Is Swimming Among Sharks

ZETA operates in a high-stakes battleground challenging legacy giants, such as Adobe ADBE and Salesforce CRM. While Zeta Global holds its own as a data-first entity, it fails to compete with Adobe’s scalability and enterprise ecosystem. Adobe’s Firefly and Creative Cloud provide an immense competitive edge. Zeta Global lacks an internal creative suite, unlike Adobe GenStudio.

On the other hand, Salesforce’s competitive advantage lies in its Data Cloud. While Zeta hails Athena as an agentic AI tool, Salesforce’s Agentforce has a much broader playing field backed by its integration across every business function. ZETA is burdened by fierce competition, which might compel it to make investments to remain in the game. However, rapid investments could potentially hamper the company’s growth and profitability balance.

Verdict: Hold Zeta Global for Now

ZETA is currently enjoying the perks of collaborating with OpenAI, which grants early access to cutting-edge models. On the financial front, Zeta Global maintains strength in terms of an ROE of 21.5% and a current ratio of 3.01, both of which beat the industry average. While the stock appears fundamentally strong, we are skeptical of the lack of analyst confidence as evidenced by the downward EPS revision. Furthermore, Zeta Global shoulders the pressure to remain abreast of the legacy competitors.

Hence, we urge investors to hold the stock for now and refrain from adding it to their portfolio any further. Investors must remain cautious and analyze Athena’s ability to deliver on the back of OpenAI’s reasoning and the Zeta Global dataset before making any move.

ZETA currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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