The Trade Desk: The Market Can't Ignore Strong Profits Forever

The Trade Desk, Inc. remains deeply discounted despite sustaining double-digit growth and >30% adjusted EBITDA margins, prompting a reiterated Strong Buy rating. Settlement of the Publicis dispute removes a key revenue headwind, with business resuming and potential for stronger results in the year's back half. TTD's valuation is compelling at ~6x FY26 adjusted EBITDA and ~10.7x FY26 P/E, with risks seen as fully priced in and M&A attractiveness rising. Long-term TTD tailwinds include programmatic ad growth, expanding ad inventory, and AI-driven advertising, while profitability remains resilient amid near-term demand headwinds.

As we head into the back half of 2026, the stock market rally is showing signs of broadening: that is, a number of software stocks have leaped beyond their March/April lows. While they remain well below prior year levels