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The Trade Desk (TTD) Gains But Lags Market: What You Should Know

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In the latest market close, The Trade Desk (TTD - Free Report) reached $114.65, with a +0.27% movement compared to the previous day. This change lagged the S&P 500's 0.36% gain on the day. Elsewhere, the Dow lost 0.28%, while the tech-heavy Nasdaq added 0.51%.

The digital-advertising platform operator's stock has dropped by 5.91% in the past month, falling short of the Computer and Technology sector's of 0% and the S&P 500's gain of 2.11%.

The upcoming earnings release of The Trade Desk will be of great interest to investors. The company's earnings report is expected on February 12, 2025. The company is expected to report EPS of $0.58, up 41.46% from the prior-year quarter. Simultaneously, our latest consensus estimate expects the revenue to be $758.05 million, showing a 25.13% escalation compared to the year-ago quarter.

It is also important to note the recent changes to analyst estimates for The Trade Desk. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.09% lower. The Trade Desk currently has a Zacks Rank of #3 (Hold).

Investors should also note The Trade Desk's current valuation metrics, including its Forward P/E ratio of 57.11. Its industry sports an average Forward P/E of 23.04, so one might conclude that The Trade Desk is trading at a premium comparatively.

One should further note that TTD currently holds a PEG ratio of 2.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TTD's industry had an average PEG ratio of 1.76 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 78, this industry ranks in the top 32% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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