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BMO Capital reiterated its outperform rating and $115.00 price target on The Trade Desk (NASDAQ:TTD) Tuesday, significantly above the current price of $68.53. According to InvestingPro data, analysts’ targets range from $39 to $135, with 10 analysts recently revising earnings estimates upward. The firm’s decision comes amid news of an exclusive partnership between Amazon (NASDAQ:AMZN) and Roku (NASDAQ:ROKU).
The partnership allows advertisers to scale their connected TV (CTV) reach to approximately 80 million U.S. CTV households through Amazon DSP. BMO noted that while no changes are expected in the direct relationship between Roku and The Trade Desk, investors might question how Roku’s inventory share could shift from TTD to other demand-side platform channels. The stock has seen significant volatility, with InvestingPro data showing a 48% decline over the past six months, though maintaining strong fundamentals with more cash than debt on its balance sheet.
BMO characterized the development as "potentially somewhat of a headline overhang for TTD" but suggested it represents an expected move by Amazon to help fill Prime Video inventory. The firm pointed out that The Trade Desk shares remained positive following the announcement.
The Trade Desk operates as a technology company that provides a self-service platform enabling ad buyers to create and manage digital advertising campaigns across various formats and channels. The company has positioned itself as a key player in the digital advertising ecosystem, particularly in the growing CTV space, demonstrating robust revenue growth of 25% in the last twelve months and maintaining an impressive 80% gross profit margin. Get comprehensive insights and 13 additional ProTips with InvestingPro’s detailed research report.
The stock has attracted attention from investors interested in the digital advertising sector, with BMO maintaining its positive outlook despite potential competitive pressures from the Amazon-Roku partnership.
In other recent news, The Trade Desk has reported financial results that surpassed expectations, with revenue and adjusted EBITDA driven by the adoption of its Kokai platform. Benchmark maintained a Hold rating on the company, citing concerns about stock valuation and potential growth alignment with industry averages. Meanwhile, Citizens JMP reaffirmed a Market Outperform rating, expressing optimism about The Trade Desk’s growth prospects and the upcoming launch of its Deal Desk initiative. BMO Capital also reiterated an Outperform rating, highlighting the Kokai platform’s enhanced tools for advertisers. The platform offers detailed insights and transparency in campaign management, although some users have faced challenges adapting to its changes. Citi analysts maintained a Buy rating with an $82 price target, noting positive trends in Connected TV that support The Trade Desk’s business outlook. Despite concerns over competition from Amazon DSP, Citi suggested that the impact on The Trade Desk might be minimal. Overall, these developments indicate a complex landscape for The Trade Desk, with analysts showing varied levels of confidence in the company’s future performance.
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