Please ensure Javascript is enabled for purposes of website accessibility

How The Trade Desk Stock Gained 52% Last Month

By Anders Bylund – May 11, 2020 at 12:26PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The digital advertising expert bounced back from a dramatic price drop in March thanks to a solid earnings report from Alphabet and improving trends in the coronavirus crisis.

What happened

Shares of The Trade Desk (TTD 4.14%) rose 51.6% in April, according to data from S&P Global Market Intelligence. The digital advertising specialist didn't have much news of its own last month, but the stock bounced back from an equally news-free drop in March and picked up steam when online ad giant Alphabet (GOOG 3.13%) (GOOGL 3.04%) reported strong results.

So what

Shares of The Trade Desk fell 32.8% in March as investors feared weak ad sales during the COVID-19 pandemic. April brought a more optimistic view of the public health crisis and its impact on economies around the world, and Alphabet underscored this bullish view with a solid first-quarter report. Ad sales under the umbrella of Alphabet's Google subsidiary rose 17% year over year, matching the growth rate seen in the fourth quarter of 2019. The Trade Desk's shares surged 14% higher the next day alone.

An office worker holds on to his desk for dear life as it takes off on a jet-powered flight.

Image source: Getty Images.

Now what

The company's own first-quarter report arrived in the first week of May, and share prices held steady after The Trade Desk exceeded Wall Street's expectations across the board.

On the earnings call, CEO Jeff Green compared the current business environment to driving a race car through a cloud of smoke. Nobody knows what's coming up in the next few yards, but the race car driver knows this track by heart and the long-term future will look great once the smoke clears.

Advertisers will need help to retool their ad campaigns for whatever comes next, and The Trade Desk is ready to help. That's why this company has delivered a 66% full-year stock return despite the sudden drop in March. We're looking at a growth stock for the ages here.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Anders Bylund owns shares of Alphabet (A shares) and The Trade Desk. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and The Trade Desk. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

The Trade Desk Stock Quote
The Trade Desk
$63.66 (4.14%) $2.53
Alphabet Inc. Stock Quote
Alphabet Inc.
$101.64 (3.04%) $3.00
Alphabet Inc. Stock Quote
Alphabet Inc.
$102.41 (3.13%) $3.11

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/05/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.