1 Growth Stock Down 65% to Buy Right Now

The Trade Desk (TTD) stock has experienced a significant 65% decline from its December peak following a revenue report indicating slowing sales growth, primarily due to the fading impact of political advertising and tariff-related pressures on large clients. In response, the company is emphasizing programmatic advertising's agility, offering flexible short-term deals, and expanding Joint Business Plans (JBPs) which are showing strong performance. Despite the slowdown, TTD generated $746 million in free cash flow over the last four quarters on $2.68 billion in revenue and projects approximately 20% growth for 2025, positioning its current valuation near historical lows amidst these strategic adjustments.

Analysis

The Trade Desk (TTD) shares have experienced a substantial 65% decline from their December peak, triggered by a "mildly disappointing revenue report" and subsequent market re-evaluation. This slowdown is primarily attributed to the fading impact of a 2024 political marketing boost and tariff-related pressures affecting large clients like McDonald's and Pepsi. Consequently, sales growth is expected to moderate from 26% in 2024 to below 20% in 2025.

In response, TTD is emphasizing the agility of programmatic advertising and strategically implementing flexible short-term deals alongside expanding Joint Business Plans (JBPs). CEO Jeff Green highlighted that JBPs are at an "all-time high" and significantly outpace the rest of the business, indicating successful adaptation. The company maintains strong financial health, having generated $746 million in free cash flow over the last four quarters from $2.68 billion in revenues.

Despite the projected growth deceleration, TTD targets approximately 20% growth for 2025, which remains a robust pace in a challenging environment. The recent correction has driven TTD's valuation to "near all-time-low valuation ratios," presenting a potential "deep discount" according to the analyst. This suggests a disconnect between the company's fundamental strength and its current market pricing.

Key Decisions for Investors

• Investors should evaluate the current valuation of TTD shares, which are trading at near all-time-low ratios despite projected 20% growth for 2025, for a potential entry point
• Monitor the effectiveness of TTD's strategic initiatives, particularly the expansion of Joint Business Plans (JBPs) and flexible short-term deals, as these are critical for sustaining growth amidst market headwinds
• Remain cognizant of ongoing macroeconomic factors, specifically tariff tensions and their potential impact on large advertising budgets, which could continue to influence client spending