A Netflix Opening Gives Us a Reason to Pick Up More of These Shares
We see this as another revenue stream for The Trade Desk, and confirmation of the company’s strategy.
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* Netflix opening its growing ad business to include Trade Desk has us adding to our position.
| Symbol | Transaction Type | #Shares Traded | Recent Price ($) | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
TTD | Buy | 117 | 91.75 | 1,570 | 3.30 |
After you receive this Alert, we will buy 117 shares of The Trade Desk TTD at or near $91.75. Following the trade, TTD shares will account for roughly 3.3% of the portfolio.
While we just added to the portfolio’s position in TTD yesterday, we are picking up some additional shares following a fresh development with Netflix NFLX.
Last night, Netflix said that its ad-supported tier now has 40 million global monthly active users, up from 5 million a year ago. The company added that more than 40% of all signups in countries that offer ad-supported tiers now come from the ads plan. That is prompting Netflix to expand its ad buying capabilities to include The Trade Desk, Google's (GOOGL) Display & Video 360, and others.
We see this as another revenue stream for Trade Desk, and confirmation of the company’s strategy as well as its position in the connected television (CTV) or streaming video market. The wider adoption of ad-supported models at Amazon AMZN, Disney DIS, and others should continue to drive demand for programmatic advertising and Trade Desk’s offerings.
Because of this Netflix news, we are likely to see upward revenue and EPS revisions for the coming quarters, and more than likely the Wall Street analyst community bumping up their price targets to those more in line with our $110 target. Already this morning, Wells Fargo lifted its TTD target to $115 from $110, Citi reiterated its $112, and Loop Capital boosted its target to $109 from $102.
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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long TTD, GOOGL, AMZN and DIS.
