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Tuesday, The Trade Desk (NASDAQ:TTD) shares maintained their Buy rating with a steady price target of $70.00, as confirmed by Citi analysts. According to InvestingPro data, TTD’s stock is currently trading near its 52-week low of $53.39, despite showing strong revenue growth of 25.6% in the last twelve months. The endorsement follows a series of channel checks that led to a more favorable view of The Trade Desk’s competitive landscape and product offerings, particularly in the connected TV (CTV) space.
The Trade Desk, renowned for its demand-side platform (DSP), continues to be the preferred DSP choice for advertising agencies. With an impressive gross profit margin of 80.7% and strong cash flows, the company maintains a solid financial foundation. Despite Amazon (NASDAQ:AMZN)’s increased efforts to enhance its own DSP, Citi’s analysis suggests that it does not pose a full-scale challenge to The Trade Desk’s market position. The company’s strength in the industry is evident, although the rollout of its Kokai project and organizational changes are seen as potential areas of concern, albeit manageable ones. (InvestingPro subscribers have access to 18 additional key insights about TTD’s financial health and market position.)
Citi’s report acknowledged the growing competition and the evolving pace of the shift towards biddable programmatic CTV advertising. While there are perceived risks, the situation is not as critical as some pessimistic views have suggested. The Trade Desk’s product quality, stronghold in the CTV market, and agency relationships remain solid, contributing to the firm’s positive stance.
The key to The Trade Desk’s continued growth and valuation, as highlighted by Citi, hinges on the total addressable market (TAM) development and the company’s capability to capture incremental biddable programmatic budgets. With analysts forecasting 18% revenue growth for FY2025 and a PEG ratio of 0.64, the company shows promising growth potential relative to its current valuation. As the advertising landscape evolves, The Trade Desk’s strategies and product innovations will be crucial factors in maintaining its leadership position. Dive deeper into TTD’s growth metrics and valuation analysis with a comprehensive InvestingPro Research Report, available for 1,400+ top stocks.
In other recent news, The Trade Desk has appointed Vivek Kundra as its new Chief Operating Officer, effective March 31st. Kundra, known for his previous role as the United States’ first Chief Information Officer, will oversee global operations and focus on driving operational excellence. The appointment aligns with The Trade Desk’s strategic emphasis on strengthening its executive team to support its growth trajectory. Analysts from Stifel have maintained a Buy rating with a $122.00 price target, reflecting confidence in the company’s strategic direction and the potential benefits of this new leadership.
Meanwhile, RBC Capital Markets has lowered its price target for The Trade Desk to $100 from $120, while maintaining an Outperform rating. This adjustment follows insights from a non-deal roadshow and reflects peer multiple compression. Truist Securities also maintained a Buy rating, setting a price target of $130, expressing confidence in The Trade Desk’s ability to overcome challenges such as the slower rollout of its Kokai platform. Additionally, Citi revised its price target to $70 from $108, citing a competitive environment but maintaining a Buy rating due to the company’s strong position in the connected TV space.
These developments highlight the mixed analyst perspectives on The Trade Desk’s future, with a focus on the company’s strategic moves and market positioning.
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