Benchmark Analysts Maintain Sell Rating for The Trade Desk Inc. Amid Revenue Concerns
Analysts at Benchmark have reiterated their Sell rating for The Trade Desk Inc. as they anticipate another revenue reset for the company’s fourth-quarter earnings.
In a note released on Monday, Benchmark analysts highlighted their concerns for The Trade Desk Inc.’s upcoming earnings report. They reiterated their Sell rating and set a price target of $32 per share. The analysts expect the company to face challenges in terms of revenue when it reports its fourth-quarter results.
Despite these concerns, the analysts believe that The Trade Desk Inc. has the potential to exceed its Q4 revenue guidance of $580 million. They predict that the company could comfortably exceed this guidance by at least $10 million or more. This optimistic outlook is based on industry data that is highly correlated to The Trade Desk Inc.’s revenue.
However, the analysts anticipate that the company’s first-quarter revenue guidance might fall short of expectations. They suggest a revenue trajectory for 2024 that is roughly 4% below consensus estimates, or approximately 16.0% compared to the previous year.
Benchmark analysts predict lower forward revenue expectations for The Trade Desk Inc. This, coupled with potential multiple compression, indicates a near-term correction in the stock price. They forecast a correction that could bring the stock price to around $53 per share.
Looking ahead, the analysts foresee increasingly challenging year-on-year revenue comparisons for The Trade Desk Inc. from the first quarter of 2024 to the third quarter. This is expected to be influenced by a muted political ad spending environment and a slowdown in connected TV (CTV) growth.
In conclusion, Benchmark analysts maintain their Sell rating for The Trade Desk Inc. They highlight revenue concerns and anticipate a possible stock correction in the near term. The company’s future revenue expectations are also expected to be lower, reflecting challenges in the political ad spending environment and CTV growth moderation.
Analyst comment
Neutral news. The Trade Desk Inc. is facing revenue concerns for its Q4 earnings, but analysts believe it has the potential to surpass guidance. However, they predict lower forward revenue expectations and a possible stock correction, with challenges in the political ad spending environment and CTV growth moderation.