#7 - Trade Desk (NASDAQ:TTD)
Earlier this year, I wouldn’t have included The Trade Desk (NASDAQ:TTD) on a list of cloud computing stocks to buy. The digital ad-buying platform is in a battle for supremacy with entrenched suspects in the ad platform game such as Amazon, Facebook (NASDAQ:FB), and Alphabet (NASDAQ:GOOGL).
The question I had at that time was the “walled gardens” that these companies created. Simply put, when you enter “ice skates” on your Google search engine, and you start getting ads about ice skates, it’s not by accident. Google is anticipating your desire to purchase ice skates. But they do so as a curated service. In other words, they don’t sell your data.
The Trade Desk opts for an open internet platform that tries to personalize the content through programmatic advertising. In this model, companies target content providers that attract their target consumers. The idea is to fine-tune their ad spend and measure their return on investment (ROI).
If the company’s recent quarter is any indication, programmatic is starting to gain traction. The company’s revenue increased by 32%, which was higher than the 13% decline in the prior quarter. And that has sent TTD stock soaring nearly 25% since the report came out on November 5.
About Trade Desk
The Trade Desk, Inc operates as a technology company in the United States and internationally. The company offers a self-service cloud-based platform that allows buyers to plan, manage, optimize, and measure data-driven digital advertising campaigns across various ad formats and channels, including video, display, audio, digital-out-of-home, native, and social on various devices, such as computers, mobile devices, televisions, and streaming devices.
Read More - Current Price
- $120.21
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 24 Buy Ratings, 3 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $115.60 (3.8% Downside)
Cloud computing stocks were starting to look a little overheated heading into 2020. The pandemic moved millions of workers to remote work and the second wave of cloud computing mania arose. And it’s not going away anytime soon.
Ask yourself this question, are companies going to be looking to collect more data or less? Is 5G going to make us less dependent on technology or more?
We are a connected world, and the cloud will be necessary to keep those connections intact and secure.
With that said, this is an industry in which valuations are … in the clouds. And that means that there is the potential for some correction either due to profit-taking or normal pullbacks. However, the long-term narrative for cloud computing is not going to go away. Companies are not likely to walk away from the cloud, even if their employees become centralized once again.
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