DigitalOcean Holdings, Inc. (DOCN) vs Zeta Global Holdings Corp. (ZETA)

DigitalOcean Holdings, Inc. and Zeta Global Holdings Corp. are both Software Infrastructure companies. DigitalOcean Holdings, Inc. is the larger, with a market value of $10.8B against $8.4B — 1.3× the size. Zeta Global Holdings Corp. has negative trailing earnings, so its P/E is not meaningful; DigitalOcean Holdings, Inc. trades at 36.9×. Zeta Global Holdings Corp. grew revenue faster over the last twelve months: 35.9% against 21.4%. DigitalOcean Holdings, Inc. has the higher net margin (23.3% vs −0.14%) and the higher return on invested capital (6.10% vs 1.89%). Across the 19 metrics below, Zeta Global Holdings Corp. leads on 11 and DigitalOcean Holdings, Inc. on 8.

Valuation

Metric DOCN ZETA Software Infrastructure median
P/E 36.85 n/m 25.33
P/S 9.65 5.27 3.11
P/B 10.48 8.94 2.91
Price to free cash flow n/m 41.02 18.80
EV/EBITDA 32.18 75.80 14.46
EV/Sales 10.24 5.20 3.01
Earnings yield 2.71% (0.06%) 0.00%
Free cash flow yield (0.05%) 2.44% 0.27%

Profitability

Metric DOCN ZETA Software Infrastructure median
Gross margin 57.22% 59.48% 59.21%
Operating margin 14.80% 1.57% 0.00%
Net margin 23.27% (0.14%) 0.00%
Free cash flow margin (0.44%) 12.86% 0.00%
Return on equity 62.27% (0.27%) 0.00%
Return on assets 9.71% (0.17%) 0.00%
Return on invested capital 6.10% 1.89% 0.00%

Growth

Metric DOCN ZETA Software Infrastructure median
Revenue growth (TTM) 21.41% 35.91% 12.44%
EPS growth (last fiscal year) 183.15% 63.16% 20.22%
Revenue growth, 5-year CAGR 23.14% 28.80% 15.74%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric DOCN ZETA Software Infrastructure median
Debt to equity 1.47 0.21 0.04
Current ratio 1.31 2.38 1.53
Net debt to EBITDA 3.87 (1.58) 0.06

Dividend

Metric DOCN ZETA Software Infrastructure median
Dividend yield — — 1.06%
Payout ratio — — 0.29

Size

Metric DOCN ZETA Software Infrastructure median
Market cap 10.82b 8.41b 644.05m

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