Zeta (ZETA) Claps Back
Last evening Zeta (ZETA) responded to the Culper Research short report with a scathing review of the allegations, saying, in short, that Culper is full of it and doesn’t know what the heck it’s talking about. It couldn’t even get Zeta’s auditor right. Link to the press release here.
Following that response, Zeta approved a $100 million share buyback program.
The bottom line is the company is fiercely defending itself, looking to take advantage of the low stock price to buy shares, and working to shore up investor confidence. It would be surprising if ZETA stock is not materially higher by the close today. That said, these things do tend to linger.
It would help if a few of the major bank analysts covering the stock also come out in defense of Zeta. However, that will require analysts to do a little more research and have the conviction to stick their necks out and tell their clients to buy. The only note I’ve seen so far is that KeyBanc downgraded ZETA to “Sector Weight” from “Overweight,” which is not helpful.
I’ll continue monitoring this situation throughout the day and update you as news becomes publicly available.
If you have a very high risk tolerance and couldn’t care less about whether ZETA is a good company or not and just want a trading thrill with potential profit, you may want to scoop some shares this morning in anticipation of a short-term bounce and/or eventual recovery.
If not, just sit tight. ZETA is down about 4% at the open. HOLD
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