The Trade Desk is Soaring After Beating the Street

Stock (Symbol)

Trade Desk (TTD)

Stock Price


Data is as of
May 15, 2017
Expected to Report
Aug 11
Company Description
The Trade Desk, Inc. is a technology company. The Company provides a self-service platform that enables clients to purchase and manage digital advertising campaigns across various advertising formats, including display, video and social, and on a range of devices, including computers, mobile devices and connected television. Source: Thomson Financial
Sharek’s Take
David SharekThe Trade Desk (TTD) stock is flying higher after the company reported a surprise profit last qtr. TTD shot from $40 to $52 on Friday, and is up to $54 today (Monday). The surge is on high volume — an indications institutions are loading up on the stock. What spurred the move is TTD reported a profit of $0.18 last qtr. Analysts had expected break-even ($0.00). This is the 2nd big beat by the company since it went public last fall. The Trade Desk is a cloud-based software platform which allows sophisticated advertising executives to manage digital ad campaigns across different spectrums, such as TV or the Internet. Recent new clients include Proctor & Gamble, one of the world’s largest banks, and a couple car manufacturers. The company has delivered a client retention rate of 95% for 13 straight qtrs. The strong push higher for this stock is a very bullish sign. I feel I need to take a position in TTD as this could be the beginning of a multi-year move higher as the stock boasts a nice Est. LTG of 32% per year. Analysts expect profits will climb from around $1 this year to $2 two years from now. I will add The Trade Desk to the Growth Portfolio today, but will just take a small position as the stock has little trading history.
One Year Chart
TTD’s numbers are hard to get at this point, as this is a recent IPO. Some figures from the year-ago periods I don’t have. Also, Thomson is giving me different numbers than the company is. Last qtr the company delivered 100% profit growth on a 76% gain in sales. Management then upped revenue guidance for the 2nd straight qtr. I like the Est. LTG of 32% per year and feel the company can grow much faster than that. The P/E of 48 high but I feel the P/E could go higher as fast-growing software stocks can get P/Es of 60 or more. Nice one-year chart, stock is breaking out here.
Fair Value
Profits are expected to climb from $0.89 last year to $1.08 this year. I think they will grow much faster as the company is growing sales at 75% right now. My Fair Value is 60x earnings which is a $65 Fair Value for this year, but I honestly don’t have a firm grasp on where the stock is headed. 
Bottom Line
The Trade Desk is a hot stock right now, and just jumped on the highest volume its had since the company had its IPO last September. This could be the beginning of a long multi-year run higher for the stock, but then again there’s not much history here so TTD could drop later on if it produces a poor outlook. I will add TTD to the Growth Portfolio today but will hold off adding it to the Aggressive Growth Portfolio due to the stock’s short trading history. I won’t make this a big holding, but with the stock soaring I do want to get invested just in case it goes on to be a big winner.
Power Rankings
Growth Stock Portfolio

21 of 29

Aggressive Growth Portfolio


Conservative Stock Portfolio


1 thought on “The Trade Desk is Soaring After Beating the Street”

  1. Pingback: The Trade Desk’s Move from $150 to $450 Was Predictable – School of Hard Stocks

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