The Trade Desk’s TTD shares have returned 5.8% in the past month, outperforming both the broader Zacks Computer & Technology sector and the Zacks Internet Services industry. While the broader sector has declined 2.2%, the industry has dropped 4.4% over the same timeframe.

The Trade Desk shares are riding on strong top-line growth driven by an expanding clientele. In the first half of 2024, revenues jumped 27% over the year-ago period, driven by higher spending from new as well as existing clients.

TTD’s self-service cloud-based platform offers automation in ad buying that helps its clients (advertising agencies, advertisers and other service providers for agencies or advertisers) easily penetrate an increasingly fragmented audience amid ongoing digitization of media. It is benefiting from an expanding global footprint, continuing development of the omnichannel ad inventory and strong adoption of programmatic advertising.

These factors have been the major drivers behind TTD’s phenomenal rise. Shares hit a 52-week high of $109.5 on Sept. 18 and finally closed at $108.02, up 50.1% year to date (YTD).

TTD Outperforms Sector YTD

 

Image Source: Zacks Investment Research

 

The technical indicator is bullish for The Trade Desk as the shares trade above the 50-day and 20-day moving averages, which indicates robust upward momentum.

TTD Trades Above 50-day & 200-day SMA

 

Image Source: Zacks Investment Research

 

Will the momentum continue for TTD? Let’s analyze the strengths and weaknesses.

Strong CTV Demand to Aid TTD’s Top-Line Growth

TTD’s initiatives, namely UID2, OpenPass and Kokai, benefit from increased demand for its advertising services. 

The Trade Desk is gaining clientele in the media industry. Roku ROKU and DIRECTV have adopted UID2. Sirius XM Media’s Pandora Media became the first audio publisher to adopt UID2. 

LG Ad Solutions integrated UID2 to enable advertisers to leverage their first-party data across LG’s extensive audience network in a privacy-conscious manner.

In the near term, The Trade Desk is expected to benefit from strong spending in the CTV and retail media domains. CTV is its fastest-growing channel, as it reaches more than 90 million households and more than 120 million CTV devices.

TTD benefits from the growing demand for digital and programmatic advertisement. Total advertising addressable market is trending toward $1 trillion, which presents a significant growth opportunity for The Trade Desk. 

Expanding international business bodes well for TTD’s prospects. International growth has outpaced North America for the sixth quarter in a row, with CTV driving growth across both EMEA and Asia Pacific.