The Trade Desk, Inc. (TTD) Stock: Here’s Why It’s Headed For The Bottom

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The Trade Desk, Inc. (TTD) is headed down in the market in today’s trading session. The stock, one that is focused on the service sector, is presently trading at $189.81 after heading down -5.49% so far today. In terms of service stocks, there are a number of factors that have the ability to lead to price movement in the market. News is one of the most common reasons for movement. Here are the recent headlines surrounding TTD:

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Oct-21-19 08:30AM The Trade Desk Announces Date of Third Quarter 2019 Financial Results and Conference Call
Oct-20-19 06:52PM Were Hedge Funds Right About Souring On The Trade Desk, Inc. (TTD)?
Oct-08-19 05:45PM The Trade Desk (TTD) Stock Moves -1.29%: What You Should Know
Oct-04-19 09:15AM Big Turnaround Brings First Green of Q4
Oct-03-19 12:56PM A Holistic Look At The Trade Desk, Inc. (NASDAQ:TTD)

However, when making a decision with regard to investing, investors should focus on far more than just news, especially in the ever complex service sector. Here’s what’s happing when it comes to The Trade Desk, Inc..

Recent Movement Out of TTD

While a single session decline, like the move that we’re seeing from The Trade Desk, Inc. may make some investors upset, a single session fall by itself shouldn’t be the basis of a decision to, or not to, invest in a stock. It is always important to look at trends experienced by the stock further out than a single trading day. As it relates to TTD, below are the returns on investment that we’ve seen:

  • Past 5 Trading Sessions – Over the last week, TTD has generated a price change in the amount of -10.47%.
  • Monthly – The return from The Trade Desk, Inc. throughout the last 30 days works out to -6.46%.
  • Quarterly – Throughout the last quarter, the stock has produced a return on investment that works out to -23.58%
  • Past 6 Months – In the past 6 months, investors have seen a change of -8.65% from the company.
  • This Year So Far – Since the the first trading session of this year TTD has produced a return of 63.54%.
  • Full Year – Lastly, over the past full year, we’ve seen movement that works out to 56.48% from TTD. Over this period of time, the stock has traded at a high price of -34.44% and a low of 85.45%.

Ratios Worth Paying Attention To

Digging into various ratios associated with a company generally gives investors a view of how risky and/or rewarding a an investment option might be. Below are a few of the key ratios to think about when digging into TTD.

Short Ratio – The short ratio is a measure of short interest. The higher this short ratio, the more investors believe that the value of the stock is going to fall. Throughout the sector, strong service sector stocks can come with a lower short ratio. However, we also tend to see a lot of short squeezes in the space. Nonetheless, as it relates to The Trade Desk, Inc., the stock’s short ratio is 3.13.

Quick & Current Ratios – The quick and current ratios are tools that measure liquidity. Basically, they measure If a company is able to cover its debts as they mature with only current assets or quick assets. come with positive quick and current ratios. In terms of TTD, the quick and current ratios come to 1.60 and 1.60 respectively.  

Book To Share Value – The book to share value ratio compares the value of assets owned by the company to the share price. In this particular case, that ratio equates to 11.09.

Cash To Share Value – The cash to share value comparison compares the total amount of cash the company has on hand to the value of shares. When it comes to TTD, the cash to share value ratio comes to 4.97.

What Institutions And Insiders Think Of The Trade Desk, Inc.

Humans that are into investing seem to be infatuated with the term “Smart money follows big money.” It makes sense. Big money became big money by making smart decisions in the market. So, by following the moves of big money institutions and insiders, we can get a glimpse of what market pros think about a stock. When it comes to big money interest in TTD, here’s what we’re seeing:

  • Institutions – At the moment, institutions own 80.10% of TTD. On the other hand, it’s worth noting that institutional ownership has moved in the amount of 0.33% throughout the last 3 months.
  • Insider Moves – As far as insiders go, members of the management team and others close to TTD currently own 1.00% of The Trade Desk, Inc.. Insider ownership of the company has moved -62.93% in the last quarter.

Analyst Opinions Of The Trade Desk, Inc.

Although it’s not a smart idea to avoid doing your DD and blindly following the thoughts of analysts, it is a smart idea to use their opinions when validating your own opinions before making investment decisions in the service industry. Below are the most recent moves that we have seen from analysts as it relates to TTD.

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Oct-11-19 Upgrade RBC Capital Mkts Sector Perform → Outperform
Sep-26-19 Upgrade Nomura Reduce → Neutral $165 → $175
Aug-09-19 Downgrade Raymond James Outperform → Mkt Perform
Jul-24-19 Downgrade Citigroup Buy → Neutral $205 → $250
Jul-18-19 Downgrade Jefferies Buy → Hold $225 → $250

What We’ve Seen In earnings results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $3.65. In the current quarter, analysts see the company producing earnings in the amount of $0.67. Over the last 5 years, TTD has generated revenue in the amount of $0 with earnings coming in at 59.92%. On a quarter over quarter basis, earnings have seen movement of 35.90% and revenue has seen movement of 42.40%.

A Look At Share Counts

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 46.53M shares of The Trade Desk, Inc. outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, TTD has a float of 36.93M.

I also like to take a look at the short float. After all, if a large percentage of the float available for trading is sold short, the overall feeling in the market is that the company is headed for a deep dive. In regard to TTD, the short percentage of the float is currently 13.18%. Most traders believe that a high short percent of the float would be considered to be anything over 40%. In my research, I’ve seen that a short percent of the float over 26% is likely a a play that could prove to be very risky.

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