The Trade Desk stock price target raised to $82 by UBS on growth outlook

The Trade Desk (TTD) reported robust Q3 results, with revenue up 17.7% year-over-year to $739 million and EPS of $0.45 significantly beating estimates, yet provided conservative Q4 guidance of 13.4% growth. While UBS raised its price target to $82, citing potential reacceleration in 2026 and current undervaluation despite a significant stock decline over the past year, RBC Capital and Evercore ISI both lowered their price targets to $80 and $70 respectively, maintaining Outperform ratings, due to peer multiple contraction, reflecting a mixed analyst outlook.

Analysis

The Trade Desk (TTD) reported robust third-quarter results, with revenue growing 17.7% year-over-year to $739 million, exceeding anticipated figures. Earnings per share significantly outperformed expectations at $0.45 against a $0.20 forecast, representing a 125% surprise. Despite this strong performance, the company provided conservative fourth-quarter revenue guidance of 13.4% year-over-year growth, which UBS noted was below historical seasonality patterns.

Analyst sentiment remains mixed despite TTD's solid fundamentals and "GOOD" financial health, with more cash than debt. UBS raised its price target to $82, maintaining a Buy rating and projecting potential reacceleration in revenue growth by Q2 2026. Conversely, RBC Capital and Evercore ISI lowered their price targets to $80 and $70 respectively, citing peer multiple contraction, yet both maintained Outperform ratings.

TTD has demonstrated a strong long-term trajectory with a 30% revenue CAGR over the past five years, though its Q3 growth lagged Meta by 8.5 percentage points. InvestingPro data suggests the stock is currently undervalued, despite a significant 65% decline over the past year. UBS believes current share prices are factoring in lower growth than its 17% estimate for fiscal year 2027, indicating a potential disconnect between market valuation and future growth prospects.

Key Decisions for Investors

• Monitor Q4 revenue performance closely for any upside surprise relative to conservative guidance, as this could signal stronger underlying momentum.
• Evaluate the impact of peer multiple contraction on TTD's valuation, considering the mixed analyst price targets despite strong company fundamentals and long-term growth trajectory.
• Consider the long-term growth reacceleration potential highlighted by UBS for 2026, weighing current undervaluation against short-term market sentiment and competitive pressures.