The Trade Desk Is Down 40%: Should You Buy TTD Stock At $70?

Forbes

26-06-2025

CHONGQING, CHINA - MAY 06: In this photo illustration, the logo of The Trade Desk, Inc. is displayed ... More on a smartphone screen, with the company's latest stock market chart in the background, reflecting investor sentiment and recent trading activity, on May 06, 2025, in Chongqing, China. (Photo illustration by)
The Trade Desk (NASDAQ:TTD) stock has faced a considerable decline of 40% in 2025, predominantly due to internal restructuring initiatives that affected short-term performance and the slower-than-expected launch of its AI platform, Kokai. This downturn raises a vital question: Is TTD worth buying following this recent drop? We believe it is.
At its present price of approximately $70, TTD stock seems appealing. Our assurance stems from a thorough evaluation that contrasts its current valuation with its historical operating performance and financial health. We have examined The Trade Desk against essential benchmarks, including its growth trajectory, consistent profitability, strong financial integrity, and proven resilience during economic recessions. This comprehensive analysis of TTD's operational capabilities and financial position leads us to conclude that there is little reason for long-term apprehension regarding the stock. However, if you are looking for higher returns with lower volatility compared to individual stocks, the Trefis High Quality portfolio offers an alternative — having outperformed the S&P 500 and delivering returns exceeding 91% since its launch. Separately, see – BigBear.ai: What's Happening With BBAI Stock?
How Does The Trade Desk's Valuation Look vs. The S&P 500?
When evaluating the cost per dollar of sales or profit, TTD stock appears quite expensive in comparison to the overall market.
How Have The Trade Desk's Revenues Grown Over Recent Years?
The Trade Desk's Revenues have significantly increased over the past few years.
How Profitable Is The Trade Desk?
The Trade Desk's profit margins are around the median level for companies within the Trefis coverage scope.
Does The Trade Desk Look Financially Stable?
The Trade Desk's balance sheet appears very robust.
How Resilient Is TTD Stock During A Downturn?
TTD stock has performed worse than the benchmark S&P 500 index during some recent downturns. While investors hope for a smooth recovery in the U.S. economy, how severe could the impact be if another recession occurs? Our dashboard How Low Can Stocks Go During A Market Crash illustrates how major stocks performed during and after the last six market crashes.
Putting All The Pieces Together: What It Means For TTD Stock
In conclusion, The Trade Desk's performance across the factors detailed above is as follows:
The Trade Desk stock showcases strong performance across the attributes we've evaluated. Although its valuation seems high when assessed against the S&P 500 index, it's presently trading below its own three-year historical average price-to-sales (P/S) ratio of 19x. For comparison, its closest competitor, AppLovin (APP), is trading at a P/S ratio of roughly 25x based on trailing revenues. See – AppLovin Stock: Worth It At $365? Furthermore, the average analyst price target of $86 for TTD indicates a significant upside potential of over 25% from its current position.
Not satisfied with the fluctuating nature of TTD stock? The Trefis High Quality (HQ) Portfolio, featuring 30 stocks, has a proven history of comfortably outperforming the S&P 500 over the last four years. What accounts for that? As a collective, HQ Portfolio stocks have delivered superior returns with less risk compared to the benchmark index; offering a smoother experience, as depicted in HQ Portfolio performance metrics.