Important note
This AI stock analysis for Trade Desk is not up to date. Creating and accessing our AI stock Analysis (powered by our data and Chat GPT) is only available for our premium users. Sign up to get access today!
Trade Desk - AI Stock Analysis
Analysis generated December 3, 2024
Trade Desk is a leading technology company that empowers buyers of advertising through its self-service, cloud-based platform. The company provides data-driven insights and advanced features that enable its users to create, manage, and optimize data-driven digital advertising campaigns across multiple channels.
Founded in 2009, Trade Desk has rapidly grown to become one of the most significant players in the programmatic advertising space. The company's focus on innovation and providing a transparent platform for advertisers has secured its reputation in the market.
Fundamental Analysis
For the last quarter, Trade Desk reported revenue of $647 million. This figure represents a 7.37% increase from the previous quarter, highlighting positive short-term growth. When compared to the same quarter in the previous year, there is a substantial increase of 26.01%, indicating robust year-over-year growth and a strong market position.
Trade Desk's net income for the last quarter was $94 million, up by 10.74% compared to the previous quarter. This impressive increase is even more pronounced when considering year-over-year growth, with net income surging by 139.27%. This significant rise suggests effective cost management and operational efficiency.
However, the EBITDA for the last quarter was $0 million, showing a 100% decrease from the previous quarter and the same quarter last year. This negative aspect indicates potential issues in core operational profitability and is a concern for long-term investors.
Trade Desk's current P/E ratio stands at 207.34, which is considerably high and could suggest overvaluation. A high P/E ratio is often seen as a bearish signal as it means investors are paying more for the company's earnings, indicating high expectations for future growth that may not always materialize.
Furthermore, recent insider selling activity in the company is another potentially bearish indicator, as it may suggest that those with the most intimate knowledge of the company are not confident in the stock's near-term prospects.
Technical Analysis
Trade Desk's stock price today is $136.48, reflecting a significant increase of 14.51% over the past month. This positive short-term trend is even more striking when considering that the stock has risen by 98.49% over the past year, indicating a strong bullish trend in the long term.
The current Simple Moving Average (SMA10) is 130.17, which is higher than the previous SMA10 of 129.49. This upward movement in SMA10 indicates a potential trend continuation toward higher stock prices.
However, the Relative Strength Index (RSI) is 82.1, suggesting that the stock is currently in an overbought condition. An RSI above 70 is generally considered an overbought condition, which could imply a potential price correction in the near term.
Alternative Data Analysis
Trade Desk has 112 open positions as per recent job postings, a decrease of 34% in the last couple of months. This reduction may indicate efforts to cut costs or streamline operations, which isn't typically a positive sign for a growth company.
On a brighter note, employee sentiment appears highly positive, with an estimated 84% of employees expressing a favorable business outlook. This metric has improved by 6% in recent months, suggesting increasing internal confidence in the company’s future.
Regarding customer acquisition, Trade Desk's webpage continues to attract approximately 1.2 million visitors monthly, showing stability in interest. Customer engagement on social media platforms is mixed, with Instagram followers up by 5% to 7,900, while Twitter followers remain static at 20,000.
Finally, the AltIndex AI score, which integrates fundamental, technical, and alternative data, gives Trade Desk a score of 58, translating to a hold signal.
Conclusion
Trade Desk showcases a robust growth trajectory as evidenced by its impressive revenue and net income increases. However, concerns arise from the EBITDA figures, high P/E ratio, and insider selling activities. While the stock price trend remains bullish in both short and long terms, the high RSI signals a potential overbought condition that might prompt a price correction.
Alternative data presents a mixed bag: while employee sentiment and Instagram engagement are positive, job postings have decreased, indicating possible cost-cutting measures. The AI score of 58 suggests a hold position, balancing out the positives and negatives currently surrounding the stock.
Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.
