Trade Desk (TTD) AI Stock Analysis

• Market Cap: $21.74B
• Dividend Yield: N/A
• Average Volume (3M): 20.76M
• Price to Earnings (P/E): 53.6
• Beta (1Y): 1.44
• Revenue Growth: 23.18%
• EPS Growth: 63.48%
• Country: US
• Employees: 3,522
• Sector: Communication Services
• Sector Strength: 97
• Industry: Software - Application
• EPS (TTM): 0.18
• Shares Outstanding: 445,666,930
• 10 Day Avg. Volume: 24,572,588
• 30 Day Avg. Volume: 20,755,234
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.58
• Enterprise Value/Revenue: 12.82
• Enterprise Value/Gross Profit: 16.15
• Enterprise Value/Ebitda: 60.20
• 1Y Price Target: $72.26
• Price Target Upside: 56.58% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 29

• Rating: 59 Neutral
• Price Target: $48.00 ▲(4.01% Upside)

Trade Desk's overall stock score is primarily influenced by its strong financial performance, which is offset by bearish technical indicators and a high valuation. The company's robust revenue growth and profitability are significant strengths, but the technical analysis suggests potential downward pressure on the stock. The high P/E ratio indicates that the stock may be overvalued, which could limit upside potential.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, positioning the company well for sustained expansion.

Platform Adoption

The successful adoption of the Kokai platform enhances operational efficiency and client satisfaction, driving long-term competitive advantage.

Connected TV Growth

CTV's rapid growth and partnerships with major companies solidify Trade Desk's position in a key digital advertising segment, ensuring future revenue streams.

Negative Factors

Underperformance in Verticals

Underperformance in certain verticals may limit overall growth potential, requiring strategic adjustments to capture opportunities in these segments.

Macroeconomic Challenges

Macroeconomic pressures could impact advertising budgets, potentially affecting Trade Desk's revenue and necessitating adaptive strategies.

Increased Operating Expenses

Rising operating expenses may pressure profit margins, requiring efficient cost management to maintain financial health and competitive pricing.

Trade Desk Business Overview & Revenue Model

Company Description

Trade Desk, Inc. operates as a technology company in the United States and internationally. The company operates a self-service cloud-based platform that allows buyers to create, manage, and optimize data-driven digital advertising campaigns across various ad formats and channels, including display, video, audio, native, and social on various devices, such as computers, mobile devices, and connected TV. It also provides data and other value-added services. The company serves advertising agencies and other service providers for advertisers. The Trade Desk, Inc. was incorporated in 2009 and is headquartered in Ventura, California.

How the Company Makes Money

Trade Desk generates revenue primarily through a commission-based model, where it takes a percentage of the total ad spend that advertisers allocate through its platform. This model is complemented by the sale of data and analytics services that help marketers understand their audience and optimize their advertising strategies. Key revenue streams include fees from advertisers for using the platform and partnerships with various media owners that expand inventory availability. Additionally, Trade Desk has established significant partnerships with data providers and technology companies, which enhance its offerings and contribute to its earnings through improved targeting and campaign effectiveness.

Trade Desk Financial Statement Overview

Summary

Trade Desk exhibits a strong financial position with consistent revenue growth, robust profitability, and efficient cash flow management. The low leverage and high return on equity highlight a well-managed balance sheet. While the decrease in stockholders' equity warrants monitoring, the overall financial health of the company is commendable, positioning it well for future growth.

Income Statement

Trade Desk has demonstrated strong revenue growth with a TTM increase of 4.26% and consistent annual growth. The gross profit margin remains robust at approximately 79.4% TTM, indicating efficient cost management. Net profit margin is healthy at 15.57% TTM, reflecting solid profitability. EBIT and EBITDA margins are stable, supporting operational efficiency. Overall, the income statement reflects a strong growth trajectory and profitability.

Balance Sheet

The company's balance sheet is solid with a low debt-to-equity ratio of 0.13 TTM, indicating prudent leverage management. Return on equity is strong at 15.19% TTM, showcasing effective use of equity capital. The equity ratio is healthy, suggesting a stable financial structure. However, the decrease in stockholders' equity over the periods could be a potential concern if it continues.

Cash Flow

Trade Desk's cash flow is robust, with a free cash flow growth rate of 8.75% TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio is solid, reflecting efficient cash conversion. The free cash flow to net income ratio of 80.26% TTM underscores the company's ability to generate cash relative to its net income, supporting financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.68B	2.44B	1.95B	1.58B	1.20B	836.03M
Gross Profit	2.13B	1.97B	1.58B	1.30B	974.91M	657.22M
EBITDA	570.57M	514.66M	280.90M	168.08M	167.04M	172.84M
Net Income	417.19M	393.08M	178.94M	53.38M	137.76M	242.32M
Balance Sheet
Total Assets	5.96B	6.11B	4.89B	4.38B	3.58B	2.75B
Cash, Cash Equivalents and Short-Term Investments	1.69B	1.92B	1.38B	1.45B	958.78M	624.04M
Total Debt	343.55M	312.21M	235.89M	260.96M	284.60M	292.43M
Total Liabilities	3.26B	3.16B	2.72B	2.27B	2.05B	1.74B
Stockholders Equity	2.70B	2.95B	2.16B	2.12B	1.53B	1.01B
Cash Flow
Free Cash Flow	745.78M	632.39M	543.30M	456.85M	318.54M	324.95M
Operating Cash Flow	929.17M	739.46M	598.32M	548.73M	378.51M	405.07M
Investing Cash Flow	-466.53M	-157.51M	-107.59M	-304.37M	-93.64M	-143.27M
Financing Cash Flow	-575.61M	-107.61M	-626.11M	31.99M	31.93M	44.68M

Trade Desk Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 46.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TTD, the sentiment is Negative. The current price of 46.15 is below the 20-day moving average (MA) of 49.53, below the 50-day MA of 63.56, and below the 200-day MA of 78.79, indicating a bearish trend. The MACD of -4.75 indicates Negative momentum. The RSI at 33.56 is Neutral, neither overbought nor oversold. The STOCH value of 18.21 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TTD.

Trade Desk Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DOCU	77 Outperform	17.07B	64.02	14.13%	―	8.29%	-71.36%
BILL	69 Neutral	5.42B	-332.79	0.61%	―	13.36%	0.00%
DDOG	68 Neutral	48.25B	399.74	3.90%	―	26.00%	-25.64%
PUBM	61 Neutral	397.82M	-142.62	-0.70%	―	3.53%	-109.03%
TTD	59 Neutral	$21.74B	53.62	16.36%	―	23.18%	63.48%
DSP	59 Neutral	592.37M	280.06	8.57%	―	30.92%	0.00%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%