The Trade Desk (TTD, Sell, target to $17 from $35) Downgrade to Sell – Numbers that are difficult to explain
We are downgrading TTD shares to Sell from Neutral with a $17 target price following tonight’s results, including weak 1Q26 guidance and new insights into material changes in the trajectory of gross spend growth and take rate. In the note, we discuss:1. TTD has entered a new phase: mid-single digit spend growth? + rising take rate
2. AMZN Ads + NFLX deal may be impacting CTV spend and non-decisioned share
3. Auto is now a headwind despite growing as a % of spend in 2025
4. Joint business partnerships being renegotiated
5. Awaiting the 10K and PUB’s % of billings
6. Does TTD have an APP problem in Mobile?
7. Outlook for margins: very back-half weighted and RIF potential rising
8. This all comes after multiple C-level changes & vote to retain super-voting control…
9. …and before the impact of agentic AI on SaaS businesses is fully known
The Trade Desk is a technology company for buyers of advertising. Through the company's self-service, cloud-based platform, ad buyers can create, manage, and optimize data-driven digital advertising campaigns across ad formats, including display, video, audio, native and social, on a multitude of devices, such as computers, mobile devices, and connected TV. The company's platform's integrations with data, inventory, and publisher partners provides ad buyers reach and decisioning capabilities, and its enterprise application programming interfaces enable its customers to develop on top of the platform.
Provided by our team of experienced analysts, our work is idea driven, based on independence of thought, sector expertise, and firmly focussed on fundamentals and valuation.
New Street Research is an independent, partner-owned, research firm specialising in equity and debt research. Our equity research embraces the following sectors:
- Pan European Telecom Services and Cable
- US Telecoms, Cable, Satellite and Towers
- Global Emerging Market Telecoms
- Japan Telecoms
- Asian Internet
- Pan European Healthcare
- Global healthcare thematic research
We provide debt research on:
- Pan European Telecom Services and Cable
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