The Trade Desk (TTD) Rises Yet Lags Behind Market: Some Facts Worth Knowing
The Trade Desk (TTD) ended the recent trading session at $87.21, demonstrating a +0.18% swing from the preceding day's closing price. This move lagged the S&P 500's daily gain of 0.86%. Meanwhile, the Dow gained 1.22%, and the Nasdaq, a tech-heavy index, added 0.51%.
The digital-advertising platform operator's stock has climbed by 1.69% in the past month, falling short of the Computer and Technology sector's gain of 3.76% and the S&P 500's gain of 2.84%.
The investment community will be closely monitoring the performance of The Trade Desk in its forthcoming earnings report. The company is forecasted to report an EPS of $0.22, showcasing a 4.35% downward movement from the corresponding quarter of the prior year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $479.63 million, up 25.3% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $1.49 per share and revenue of $2.39 billion, which would represent changes of +18.25% and +22.94%, respectively, from the prior year.
Any recent changes to analyst estimates for The Trade Desk should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. The Trade Desk is currently a Zacks Rank #3 (Hold).
Investors should also note The Trade Desk's current valuation metrics, including its Forward P/E ratio of 58.62. Its industry sports an average Forward P/E of 25.35, so one might conclude that The Trade Desk is trading at a premium comparatively.
It's also important to note that TTD currently trades at a PEG ratio of 2.55. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Internet - Services industry stood at 2.19 at the close of the market yesterday.
The Internet - Services industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 69, placing it within the top 28% of over 250 industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained 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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