Shares of Trade Desk Inc (NASDAQ:TTD) are up 11.4% to trade at $84.06 this morning, after news broke that the software firm will replace Ansys (ANSS) on the S&P 500 Index (SPX) before the open this Friday, July 18.
Shares of The Trade Desk (NASDAQ: TTD) jumped on the news that the company will be added to the S&P 500 index.
The Trade Desk stock jumped 14% in after-hours trading on July 14 following the announcement of its inclusion in the S&P 500. While this achievement confirms the programmatic advertising leader's standing in the market, investors are faced with a company boasting strong fundamentals that is trading at premium valuations, which have shown significant volatility during times of market stress.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price.
TTD expects Q2 revenues to rise 17% YoY, with AI adoption and CTV gains offsetting macro headwinds and rising costs.
The Trade Desk TTD, a well-known name in the programmatic advertising space, has seen its stock take a significant hit. The stock price has declined 23.3% over the past year, underperforming the Zacks Internet Services industry's decline of 1.9%.
The Trade Desk (TTD) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
In the most recent trading session, The Trade Desk (TTD) closed at $73.49, indicating a +2.08% shift from the previous trading day.
I reiterate my Buy rating on The Trade Desk with a $87 price target, seeing a 25% upside despite recent competitive concerns from Amazon. I remain bullish on Kokai platform adoption and innovations like OpenPath to drive efficiency, transparency, and measurable results, supporting high teens to low twenties revenue growth in the future. Amazon DSP's partnership with Roku is a competitive threat, but I believe Google will lose more market share than The Trade Desk, given the latter's superior objectivity in open internet.
We rate The Trade Desk a Strong Buy with a $132 price target, citing underappreciated compounding upside from Kokai AI adoption and CTV mix shift. Kokai's rapid adoption is driving 42% lower campaign costs, margin expansion, and a flywheel of incremental spend, with OpenPath/Sincera further boosting take-rates. TTD's $1.7bn net cash and $400mn annual buybacks provide downside protection and per-share lift, supporting a premium multiple and sustained outperformance.
The Trade Desk has rebounded sharply after addressing sales execution issues, with Q1 revenue growth accelerating and beating expectations by a wide margin. Programmatic advertising's rise, a massive $1 trillion TAM, and connected TV growth underpin my bullish thesis despite macroeconomic headwinds. Valuation remains elevated, but The Trade Desk's ability to deliver ~20% growth and strong margins in a tough environment justifies a premium.
Management successfully reoriented expectations in a challenging macro environment. The company benefits from the ongoing shift to digital advertising and is taking market share, positioning it for sustained long-term growth. Valuation is now at a premium and future returns will rely on continued high growth rather than multiple expansion.