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Investing.com - KeyBanc has reiterated its Overweight rating and $88.00 price target on The Trade Desk (NASDAQ:TTD), despite recent market concerns about competitive pressures. According to InvestingPro data, the stock’s RSI indicates oversold territory, while the company maintains strong fundamentals with a "GOOD" overall financial health score.
The Trade Desk shares closed down 12% while the NASDAQ remained flat, with the stock now trading at significantly lower multiples compared to its three-year medians. The stock has declined over 60% year-to-date, with current valuation metrics suggesting the stock is trading below its InvestingPro Fair Value. KeyBanc attributes this devaluation to market narratives about Amazon taking meaningful market share, potential pressure on The Trade Desk’s take rate, and concerns about eroding growth.
KeyBanc suggests investor confidence in The Trade Desk may require two to three quarters of consistent execution to rebuild. The core issue revolves around whether the company is maturing into a high-single-digit to low-double-digit percentage grower or can re-accelerate to high-teens to 20% year-over-year growth.
The second-quarter deceleration to 19% year-over-year growth and competitive concerns from Amazon DSP have contributed to bearish sentiment. The Trade Desk’s fourth-quarter 2024 execution issues and conservative third-quarter 2025 guidance have also influenced investor perspectives.
For long-term investors, KeyBanc believes the current valuation, which sits at three-year lows for next-twelve-months EV/EBITDA and EV/S multiples, represents a compelling entry point. While maintaining its $88 price target, KeyBanc has lowered both its bear case to $34 and bull case to $107 to reflect lower multiples resulting from competitive dynamics. InvestingPro analysis reveals 18 additional investment tips and a comprehensive Pro Research Report, offering deeper insights into The Trade Desk’s valuation and growth prospects.
In other recent news, The Trade Desk reported its Q2 2025 earnings, which exceeded expectations. The company announced earnings per share of $0.41, surpassing the anticipated $0.40. Revenue also came in higher than expected at $694 million, compared to the projected $685.54 million. Despite these strong financial results, the stock experienced a significant drop in after-hours trading, reflecting investor concerns. Additionally, Stifel has reiterated its Buy rating for The Trade Desk, maintaining a price target of $90.00. This follows discussions with company executives at Stifel’s 2025 Tech Executive Summit. The Trade Desk’s Chief Commercial Officer and Senior Manager of Investor Relations participated in these meetings, according to Stifel analyst Mark Kelley. These developments provide investors with insights into the company’s recent performance and market perceptions.
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