UPDATE: Stephens Assumes Coverage on The Trade Desk (TTD), Upgrades to Overweight
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Stephens analyst Nicholas Zangler upgraded The Trade Desk (NASDAQ: TTD) from Equal Weight to Overweight with a price target of $85.00 (from $700.00).
The analyst comments "Valuation is our biggest hangup with the TTD exemplified by a F22 P/E of 99x, EV/EBITDA of 63x and a P/S 21x, which dwarf most ad tech peers outside of ROKU. Despite valuation, the proliferation of Connected TV represents a worthwhile catalyst. We believe TTD's dominant positioning as the independent demand side platform of choice makes the stock a compelling pick, particularly as linear TV ad spend is engulfed by CTV. We believe the $9 bil. in U.S. CTV ad spend will grow to $72 bil. in the coming years as linear TV fully converts. Measurement and attribution brought to the household big screen will attract more performance advertisers, who will only be limited by internal ROI hurdle rates and will deploy incremental ad spend in an effort to reach maximum efficiency. Our rating is OW/V and our $85 PT is based on a 70x F22 EV/EBITDA multiple."
Shares of The Trade Desk closed at $74.11 yesterday.
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