Piper Sandler Starts The Trade Desk (TTD) at Neutral

Piper Sandler analyst Thomas Champion initiates coverage on The Trade Desk (NASDAQ: TTD) with a Neutral rating and a price target of $55.00.

The analyst comments "TTD Strategically Positioned in CTV & Retail Media: We like TTD’s business model and proximity to the CTV space. At ~50% of Gross Spend and growing estimated 32% y/y in 2024, TTD should continue to benefit from the spend migration from linear TV. TTD also has a sizable Retail Media business including partners like WMT, TGT, & CVS. With these industry tailwinds, solid management and superior technology, TTD outpaced industry growth by ~16% the last 5 years. • PSC Ad Buyer Survey Shades Positive for TTD: Interestingly, in our recent 2025 Ad Buyer survey, CTV and Retail media were the only formats to see improving ROI y/y. Further, ad buyers we surveyed seem bullish on TTD for the open web. TTD’s display share is pegged to grow 430bps y/y into ’25. • 4Q Report Could be an Anomaly: The 4Q24 earnings report was disastrous for TTD, missing revenue and EBITDA guidance by 2% / 4%, respectively. This follows 33 quarters of beats outside 1Q20’s pandemic black swan. Management copped to a sales reorganization. Comments have further suggested an opportunistic “reset” to expectations. TTD probably gets back on track, but we worry this could take 1-2 more quarters to realign. The company did hire a new COO which should help things. • Mixed Signals — Ad Buyer More Cautious: Monthly trending data from an ad buyer we work with gives us pause. We look at monthly results and 1-month forward views since September of last year. Three of the six monthly readings fell short expectations suggesting an erratic trend. • TTD is a Solid Technologist: We do find impressive uptake of TTD’s technology and standards. In the last 8 quarters two dozen partners have announced support for UID2 & EUID, including the likes of Paramount, WB Discovery, and Walmart Connect. More than a dozen partners are now collaborating on CTV and OpenPath. • Below Consensus Forecasts, $55 Target: We find ourselves below the street on financial metrics. For 2025, we are 2% below consensus on Gross Spend, Revenue & EBITDA. There’s clearly uncertainty and downside risk from a weakening ad market & tariffs. On our DCF-based target, we land at $55 & Neutral rating."

For an analyst ratings summary and ratings history on The Trade Desk click here. For more ratings news on The Trade Desk click here.

Shares of The Trade Desk closed at $48.45 yesterday.

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