The Trade Desk shares slide after Q3 report; analyst says buy weakness

The Trade Desk (NASDAQ:TTD ) reported third-quarter earnings that beat analyst estimates, but shares tumbled 8% as the results and guidance failed to surpass lofty market expectations.

The advertising technology company posted adjusted earnings per share of $0.41, exceeding the analyst consensus of $0.39. Revenue for the quarter came in at $628 million, up 27% YoY and above the $620.01 million estimate.

"The Trade Desk delivered strong performance in the third quarter, with revenue of $628 million, accelerating growth to 27%," said Jeff Green, Co-founder and CEO of The Trade Desk. "This performance underlines the value that advertisers are placing on precision and transparency as they work with us to maximize the impact of their campaigns."

For the fourth quarter, The Trade Desk expects revenue of at least $756 million, slightly above the analyst consensus of $752.2 million. The company's adjusted EBITDA guidance for Q4 stands at approximately $363 million.

"Exiting TTD's 3Q24 print, our view is largely consistent -- despite some intraquarter hand-wringing around brand performance, the overall ad market still feels healthy, and Trade Desk has several idiosyncratic levers to drive upside relative to that baseline," BTIG analysts commented.

"We continue to view Trade Desk as a long-term winner amidst ongoing offline-to-online TV budget shifts, and further programmatic shifts within the digital market," they noted.

Jefferies analysts led by James Heaney also shared bullish comments, saying they "would be buyers of weakness" in TTD shares due to positive catalysts in fiscal 2025 year. They slightly lifted their TTD price target from $136 to $138. 

Despite the solid results and positive outlook, the 8% drop in share price suggests investors had set even higher expectations for the ad tech firm. 

The company highlighted its continued success in customer retention, maintaining a rate of over 95% for the tenth consecutive year. 

Senad Karaahmetovic contributed to this report. 

 

 

Source: Investing.com