The Trade Desk, Inc. (NASDAQ:TTD) shares are trading higher on Wednesday. B of A Securities analyst Jessica Reif Ehrlich initiated coverage on the company with a Buy rating and a price target of $135.
The analyst writes that the company has strategically positioned itself in the expanding Connected TV and Retail Media ad markets, positioning TTD to benefit from anticipated global growth in these sectors over the coming years.
TTD’s culture of innovation and clear vision has reinforced its competitive edge in programmatic advertising, even amid competition from major tech companies, says the analyst.
Ehrlich adds that TTD’s focus on identity solutions (e.g., UID 2.0) not only benefits the company but also highlights their pivotal role in advancing the industry towards a more open internet.
The analyst writes that TTD has ample room for growth in both revenue and profit, despite its recent strong performance.
She further adds that the linear advertising market, valued at over $60 billion, faces secular challenges and is likely to lose share. This shift presents an opportunity for TTD, particularly in CTV and other digital areas where it is well-positioned.
As per the analyst, significant growth drivers include the expanding Retail Media market, audio advertising, and international opportunities. Consequently, over the next three years, Ehrlich expects TTD’s revenue to grow at approximately 23% CAGR and EBITDA at around 27% CAGR.
Investors can gain exposure to the stock via SmartETFs Advertising & Marketing Technology ETF (NYSE:MRAD) and Pacer Nasdaq 100 Top 50 Cash Cows Growth Leaders ETF (NASDAQ:QQQG).
Price Action: TTD shares are up 1.57% at $102.56 at the last check Wednesday.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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