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The Trade Desk (TTD) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·3 mins read

The Trade Desk (TTD) closed at $613.11 in the latest trading session, marking a +1.25% move from the prior day. This move outpaced the S&P 500's daily gain of 0.88%. Elsewhere, the Dow gained 0.57%, while the tech-heavy Nasdaq added 1.39%.

Prior to today's trading, shares of the digital-advertising platform operator had gained 41.78% over the past month. This has outpaced the Computer and Technology sector's gain of 4.73% and the S&P 500's gain of 3.54% in that time.

Wall Street will be looking for positivity from TTD as it approaches its next earnings report date. In that report, analysts expect TTD to post earnings of $0.48 per share. This would mark a year-over-year decline of 36%. Meanwhile, our latest consensus estimate is calling for revenue of $180.55 million, up 9.96% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.17 per share and revenue of $732.40 million, which would represent changes of -14.09% and +10.79%, respectively, from the prior year.

Any recent changes to analyst estimates for TTD should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TTD is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, TTD is currently trading at a Forward P/E ratio of 191.13. This represents a premium compared to its industry's average Forward P/E of 38.64.

We can also see that TTD currently has a PEG ratio of 7.65. 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. The Internet - Services was holding an average PEG ratio of 2.04 at yesterday's closing price.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 164, which puts it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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