Shares of
Trade Desk
were rising double-digits Friday after the advertising-technology company issued better-than-expected guidance.
Trade Desk
was up 15% to $86.84, putting it on track for its largest increase since Feb. 15, 2023, when it gained 33%, according to Dow Jones Market Data.
Trade Desk on Thursday posted fourth-quarter adjusted per-share earnings of 41 cents, meeting Wall Street forecasts, according to FactSet. Revenue of $606 million beat estimates for $582.1 million.
For the first fiscal quarter, the company said it expects revenue of at least $478 million and adjusted earnings before interest, taxes, depreciation, and amortization of about $130 million, both higher than analysts’ calls for $469 million and $125 million, respectively.
The report had Truist Securities analysts led by Youssef Squali applauding. “Execution remains exceptional amid a volatile digital ad environment, reflecting further market share gains,” they wrote in a research report.
“Strength is being driven by Connected TV given its rapid adoption in the US and Int’l, fueled by growing inventory from ad-supported streaming services, augmented by Retail Media budgets moving to the platform and political & Olympics ad spend coming in 2H24,” Truist continued. Connected TV refers to content that is streamed from the internet and watched on a television or mobile device.
Truist maintained its Buy rating and lifted its price target to $100 from $80.
Oppenheimer analysts led by Jason Helfstein struck a similar chord noting “accelerating ad demand” in a report Friday. They maintained their Outperform rating and raised their price target to $105 from $85.
Needham analysts Laura Martin and Dan Medina highlighted a different part of the report, exploring how Trade Desk fits into the wider internet narrative. Here’s the background: Google is in the midst of phasing out third-party cookies—which track internet activity—by the second half of this year, which serves up a challenge to digital advertisers who have relied on that information.
Trade Desk, however, has an alternative to third-party cookies called United ID 2.0, which it said multiple streaming services have adopted, the analysts explained.
The company “believes that helping to build a new identity and authentication for the open internet will be a key growth driver in 2024, as Cookies crumble,” Needham wrote in a note titled, “As Data Becomes More Valuable, so Does TTD.” They maintained their Buy rating and $100 price target.
Benchmark analyst Mark Zgutowicz was less optimistic, acknowledging the strong quarter but voicing concerns — one being disruptions in the second half of the year “related to Chrome cookie deprecation.” He maintained his Sell rating but lifted his price target to $42 from $32.
Write to Emily Dattilo at [email protected]
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