A Holistic Look At The Trade Desk, Inc. (NASDAQ:TTD)
I've been keeping an eye on The Trade Desk, Inc. (NASDAQ:TTD) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe TTD has a lot to offer. Basically, it is a financially-healthy company with a great history and an optimistic growth outlook. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at the report on Trade Desk here.
Flawless balance sheet with high growth potential
One reason why investors are attracted to TTD is its notable earnings growth potential in the near future of 30%. This growth in the bottom-line is bolstered by an impressive top-line expansion of 72% over the same period, which is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. Over the past year, TTD has grown its earnings by 76%, with its most recent figure exceeding its annual average over the past five years. Not only did TTD outperformed its past performance, its growth also surpassed the Software industry expansion, which generated a 23% earnings growth. This is an notable feat for the company.
TTD's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that TTD has sufficient cash flows and proper cash management in place, which is an important determinant of the companys health. Investors should not worry about TTDs debt levels because the company has none! This implies that the company is running its operations purely on off equity funding. which is rather impressive for a US$8.3b market cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
Next Steps:
For Trade Desk, I've compiled three relevant aspects you should further research:
Valuation: What is TTD worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether TTD is currently mispriced by the market.
Dividend Income vs Capital Gains: Does TTD return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from TTD as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TTD? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
