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The Trade Desk (TTD) Gains As Market Dips: What You Should Know

Zacks Equity Research

The Trade Desk (TTD) closed the most recent trading day at $265.13, moving +1.83% from the previous trading session. This change outpaced the S&P 500's 0.26% loss on the day. Meanwhile, the Dow lost 0.09%, and the Nasdaq, a tech-heavy index, lost 0.24%.

Coming into today, shares of the digital-advertising platform operator had gained 11.37% in the past month. In that same time, the Computer and Technology sector gained 5.19%, while the S&P 500 gained 2.87%.

TTD will be looking to display strength as it nears its next earnings release, which is expected to be August 8, 2019. In that report, analysts expect TTD to post earnings of $0.68 per share. This would mark year-over-year growth of 13.33%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $155.09 million, up 38.06% from the year-ago period.

TTD's full-year Zacks Consensus Estimates are calling for earnings of $2.93 per share and revenue of $649.96 million. These results would represent year-over-year changes of +8.52% and +36.18%, respectively.

Investors might also notice recent changes to analyst estimates for TTD. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TTD currently has a Zacks Rank of #3 (Hold).

Investors should also note TTD's current valuation metrics, including its Forward P/E ratio of 88.95. Its industry sports an average Forward P/E of 29.08, so we one might conclude that TTD is trading at a premium comparatively.

We can also see that TTD currently has a PEG ratio of 4.45. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. TTD's industry had an average PEG ratio of 2.99 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 145, which puts it in the bottom 44% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TTD in the coming trading sessions, be sure to utilize Zacks.com.


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