Evercore ISI reaffirmed its Outperform rating and $70 price target on The Trade Desk (NASDAQ: TTD), citing expectations for a modest fourth-quarter earnings beat and constructive guidance.
The analyst indicated that based on intra-quarter data points, recent consumer packaged goods channel checks, and sensitivity analysis, The Trade Desk is likely to deliver a modest fourth-quarter beat and in-line guidance, with greater upside than downside potential for the first-quarter outlook.
With shares down approximately 33% year to date, Evercore believes market expectations are muted and reiterated its near-term Tactical Outperform positioning.
The firm acknowledged some softness in the CPG category and increased competitive pressure from Amazon DSP but noted that The Trade Desk has responded with enhanced value propositions, including Audience Unlimited and other pricing levers to drive higher platform engagement and spending.
Easing comparisons excluding political advertising were also cited as a positive factor. The firm estimates gross spend excluding political ads decelerated by 2 percentage points in Q4 2024, following 8-point decelerations in both Q3 and Q2 2024.
On profitability, Evercore expects Street EBITDA estimates to be achievable and aligned with management guidance, which implies roughly 9% quarter-over-quarter expense growth, above recent seasonal norms.
