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The Trade Desk (TTD) to Report Q4 Earnings: What's in Store?

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The Trade Desk (TTD - Free Report) is set to release fourth-quarter 2019 results on Feb 27.

For fourth-quarter 2019, the company expects revenues of $213 million. The Zacks Consensus Estimate for revenues is currently pegged at $213.3 million, indicating 32.9% growth from the year-ago quarter reported figure.

Moreover, the Zacks Consensus Estimate for earnings has remained unchanged at $1.19 per share over the past 30 days and suggests growth of 9.2% from the figure reported in the year-ago quarter.

The company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 46.4%.

Let’s see how things have shaped up prior to this announcement.
 

The Trade Desk Inc. Price and EPS Surprise

Factors to Consider

The Trade Desk’s top line in the fourth quarter is expected to have benefited from momentum in programmatic ad buying and continued strength in mobile video and mobile in-app spending, which grew 58% year over year in the third quarter.

The emergence of digital content has boosted the usage of the company’s inventory across all forms of CTV. Notably, companies like Amazon (AMZN - Free Report) and Disney (DIS - Free Report) , among others, are expected to have been the primary drivers of The Trade Desk’s CTV inventory during the fourth quarter.

Continued strength in customer retention is also expected to have boosted the company’s revenues during the quarter. The Trade Desk’s customer retention rate has remained more than 95% in the previous 23 quarters.

Moreover, the company’s partnership with Amazon Publisher Services to bring programmatic demand to third-party premium TV content providers is expected to have improved advertiser confidence and driven demand for the platform in the fourth quarter.

Internationally, the company has partnered with some of the biggest media companies, such as Channel 4 in England, ProSieben in Germany and France based TF1, where the company has been focusing on monetizing premium ad-funded content.

Moreover, The Trade Desk’s partnerships with Blue Media, Baidu (BIDU - Free Report) , Alibaba and Tencent are likely to have resulted in expanded market share in China in the to-be-reported quarter.

Notably, through its partnerships, the company has been helping advertisers reach premium audiences globally. Additionally, its clients can tap the China market using the same platform they use for the rest of the world. This is expected to have attracted advertisers and driven top-line growth.

However, higher operating expenses, particularly selling & marketing, are likely to have kept margins under pressure.

Zacks Rank

The Trade Desk currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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