The Trade Desk (TTD) closed at $198.74 in the latest trading session, marking a -0.03% move from the prior day. This change lagged the S&P 500's 0.16% gain on the day. Meanwhile, the Dow gained 0.42%, and the Nasdaq, a tech-heavy index, added 0.03%.
Coming into today, shares of the digital-advertising platform operator had lost 3.48% in the past month. In that same time, the Computer and Technology sector gained 4.43%, while the S&P 500 gained 2.89%.
Investors will be hoping for strength from TTD as it approaches its nex t earnings release. The company is expected to report EPS of $0.25, down 26.47% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $116.98 million, up 36.54% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $2.56 per share and revenue of $640.48 million, which would represent changes of -5.19% and +34.19%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for TTD. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. TTD is currently a Zacks Rank #4 (Sell).
In terms of valuation, TTD is currently trading at a Forward P/E ratio of 77.57. For comparison, its industry has an average Forward P/E of 30.19, which means TTD is trading at a premium to the group.
We can also see that TTD currently has a PEG ratio of 4.23. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Services industry currently had an average PEG ratio of 3.46 as of yesterday's close.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 158, putting it in the bottom 39% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of NASDAQ, Inc.