What Caught Our Attention in the Investment World? – Week of May 10-14, 2021

By Kuldip K. Ambastha

The Trade Desk, Inc. (TTD) is a global technology company in the digital advertising campaigns space. The company was founded in 2009 and is headquartered in California. Its stock went public in 2016.

On Monday, May 10, 2021, the company’s stock saw a dramatic -26.0% loss for the trading day. Though key performance metrics (such as earnings, revenues, and net income) for the last quarter (1Q2021) were broadly positive, investors bid down the share price. As part of announcing details related to 1Q2021 performance, corporate executives ascribed the company’s success mainly to programmatic ad buying in the connected TV arena.

(Programmatic ad buying refers to a way to buy and optimize digital advertising, without a need to negotiate financial terms directly in-person with publishers. Connected TV, also known as smart TV, refers to when a TV unit has integrated Internet and interactive Web 2.0 features allowing a user to browse the Internet, stream music & videos, and view photos alongside watching standard TV content.)

Success in this one facet of the digital advertising campaigns space was not enough for investors, who presumably were wanting to see success across multiple facets instead. Fears of potential inflation did not help either, and led to stocks in the technology sector showing volatility on a day-to-day returns basis during the trading week. If inflation is seen in the future, then interest rates worldwide may be raised by central banks, investors may prefer to save as opposed to invest, and riskier growth equity sectors (such as the technology sector of which The Trade Desk, Inc. is a part) will suffer.

Keywords – The Trade Desk, Inc., The Trade Desk, Trade Desk, TTD, technology, tech, digital advertising, digital ads, California, performance, metrics, earnings, revenues, net income, 1Q2021, programmatic ad buying, connected TV, smart TV, Internet, Web 2.0, inflation.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in TTD.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2021 – Ambastha Financial LLC.

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