Zeta Global’s stock price jumped 15% yesterday as the corporate issued a detailed rebuttal to a report critical of its financial practices. Shares closed at $25.4 Wednesday after opening at $22.
Last week, short-seller Culper Research issued a report alleging the AI marketing cloud company “formed ‘two-way’ contracts with third-party consent farms wherein the Company concurrently acts as each a supplier and a buyer of consumer data, not only allowing the Company to flatter reported revenue growth, but raising round tripping concerns.”
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Round tripping is when an organization sells an unused asset to a different company while agreeing to purchase back it or similar assets at in regards to the same price.
In yesterday’s response, Zeta stressed that its financial statements are complete, accurate and reviewed by its external auditing firm. The company refuted claims of “consent farms” and clarified round-tripping concerns.
Culper Research is owned by Christian Lamarco, who is thought for short-selling stocks and should make the most of a drop in Zeta’s stock price. A disclaimer for the report on Zeta states, “You should assume that Culper…has a position in any securities covered herein.“
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