The Trade Desk (TTD)

Technology

MYST Advisors

Emerging competitive pressures from Amazon's in-house DSP create a very real and underappreciated bear case. Furthermore, TTD has likely been overearning the last several years as the majority of CTV spending occurred in the open internet, yet much of these ad dollars are now shifting back toward the walled gardens (AMZN / Netflix). TTD’s mature client base is no longer growing, rendering it increasingly reliant on customer spend growth. Amid lofty expectations and an elevated ~45x FY25 EBITDA multiple (>2x PEG vs. ~0.9x average for AdTech peers), the share price could fall as much as ~50% over the next 12-24 months.

- 24 January, 2025

The Trade Desk (TTD)

Communications

Arete Research

You can’t fight gravity - Arete previously discussed how TTD’s messianic rhetoric perpetuated a set of misconceptions about its business to help it maintain valuations several standard deviations above everything else in ad tech. They now see this coming to a “pinch point” in ‘23E, when growth reverts to a mean closer to industry averages, when TTD’s efforts to inflate its take rate get exposed, and the gap between its “save the industry” rhetoric and own operations collapses. Trades at 33x ’23E consensus Adj. EV/EBITDA despite having ~40% of net revenues at risk from pending policy / regulatory changes. TP $27 (50% downside).

- 25 November, 2022