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Benchmark maintained its Hold rating on The Trade Desk (NASDAQ:TTD), a digital advertising technology company with a $33.5 billion market cap, following news of a partnership between Amazon (NASDAQ:AMZN) and Roku (NASDAQ:ROKU) that raised questions about potential competitive impacts. According to InvestingPro data, TTD maintains strong financial health with an impressive 80% gross profit margin and 25% revenue growth over the last twelve months.
The Amazon-Roku collaboration, announced Tuesday morning, will allow Amazon’s demand-side platform (DSP) to access Roku’s logged-in users, with the feature becoming available to advertisers by the fourth quarter of 2025.
The announcement comes just months after The Trade Desk formed its own partnership with Roku in April 2024, which paired Roku’s household identity with The Trade Desk’s UID2 identification system.
Benchmark noted that the competitive impact would depend on several factors, particularly match rates across platforms, stating: "if TTD’s UID2 match with Roku’s household ID is stronger than Amazon DSP to Roku’s logged-in user, the advertiser will prefer the former."
The research firm emphasized The Trade Desk’s advantages, including "a substantially stronger advertiser base relative to Amazon DSP, particularly given its vastly superior open internet reach," and concluded it does not see "significant implications here in terms of lost TTD advertiser share relative to Amazon DSP."
In other recent news, The Trade Desk has been the focus of several analyst reports, reflecting its latest financial performance and strategic developments. The company’s recent earnings report showed revenue and adjusted EBITDA exceeding expectations, driven largely by the adoption of its Kokai platform. Cantor Fitzgerald responded by raising its price target to $71, noting a 7% revenue beat in the first quarter, while also maintaining a Neutral rating. BMO Capital reiterated an Outperform rating with a $115 price target, highlighting the Kokai platform’s advanced capabilities in campaign management and audience targeting.
Citizens JMP analysts also reaffirmed a Market Outperform rating, setting a $100 price target, and expressed confidence in The Trade Desk’s growth prospects with the upcoming launch of its Deal Desk initiative. Meanwhile, Citi maintained a Buy rating with an $82 target, emphasizing positive trends in Connected TV and programmatic advertising. However, Benchmark remained cautious, keeping a Hold rating due to concerns over stock valuation and potential industry growth alignment.
The Trade Desk’s management has indicated that macroeconomic factors have not yet negatively impacted the business, although they are monitoring developments in the consumer packaged goods and automotive sectors. Despite positive financial results, some analysts, like Benchmark, caution about the company’s reliance on a few major agencies for a significant portion of its billings. As The Trade Desk continues to navigate these dynamics, the company’s strategic initiatives and platform advancements remain under close observation by investors and analysts alike.
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