The Trade Desk (TTD) saw its shares rise 2.01% to close at $19.28 on Friday, following a report that the ad-tech company had resolved a long-standing dispute with Publicis. The settlement removed a significant overhang for the stock, which had been trading near its 52-week low of $18.31. The stock fluctuated between $18.31 and $19.99 before settling, with volume reaching 30.63 million shares, well above the average of 20.95 million.
According to Digiday, the resolution came after Publicis had removed The Trade Desk from its recommended demand-side platform (DSP) list in March due to audit concerns related to fee practices. The dispute had raised investor worries about transparency and take rates, the portion of ad spending retained by the company as revenue. With the settlement, Publicis has resumed recommending TTD to its clients, alleviating a key concern for investors.
Despite this positive development, the stock remains far from its 52-week high of $91.45, and the broader downward trend has not reversed. The company now faces the challenge of proving that advertiser demand and margins can recover, with second-quarter earnings serving as the next major test.
In a move to strengthen its leadership, The Trade Desk appointed Sarah Gavin as chief marketing officer and executive vice president, effective June 15. CEO Jeff Green praised her “world-class marketing and communications expertise.” Gavin previously served as chief communications officer and interim CMO at Zendesk. She will oversee brand, communications, customer marketing, and demand generation.
Bullish analysts point to the Publicis settlement, management changes, and potential gains from connected-TV (CTV) supply. Samsung Ads is set to open its premium home-screen TV ads to programmatic buys in the third quarter, starting with The Trade Desk and Google DV360. Will Doherty, inventory development SVP at The Trade Desk, described this as a “unified view” for advertisers. The company reported Q1 customer retention above 95%, revenue up 12% year-over-year to $689 million, and expects Q2 revenue of at least $750 million.
However, bears argue that Friday’s pop may be a temporary relief rally rather than a sustainable turnaround. Net income fell to $40 million in Q1, down from $51 million a year earlier, while adjusted EBITDA edged down to $206 million from $208 million. Analyst ratings remain mixed, with 10 Buy, 14 Hold, and 3 Sell ratings over the past three months, and an average 12-month price target of $24.36, ranging from $11 to $38.
The company’s price-to-earnings ratio of 21.73 is not excessive for a profitable tech firm, but the wide range of analyst targets, recent dispute, weak share price, and declining profitability place TTD in turnaround territory. Management must deliver on growth and margin improvement before the stock can regain investor confidence.
