What happened

Shares of The Trade Desk (NASDAQ:TTD) rose 30.5% in June, according to data from S&P Global Market Intelligence. The surge started with a rosy business update from online ad services peer Criteo (NASDAQ:CRTO) and ended with a bullish analyst report.

A red arrow smashes upward through a wall of blue bricks.

Image source: Getty Images.

So what

Digital advertising businesses of all stripes had expected revenue to fall in the second quarter as ad buyers scaled down their campaigns amid the COVID-19 pandemic. But Criteo's mid-quarter business update in early June showed stronger sales than expected, undermining the negative expectations in the ad sector. Criteo's stock closed 19% higher that day and The Trade Desk rode Criteo's coattails to a 12% single-day gain.

On June 22, analyst firm Needham lifted its price target on The Trade Desk from $370 to a Street-high $475 per share. Analyst Laura Martin cited The Trade Desk's position as the "largest demand-side platform in the open internet" and argued that the coronavirus crisis should be a positive game-changer for the company. The Trade Desk is Martin's top pick for 2020, ahead of ad-powered media streaming expert Roku (NASDAQ:ROKU).

Now what

Needham's analysis showed that ad buyers are struggling to develop effective marketing campaigns in this uncertain business environment, opening the door for data-driven campaign-boosting platforms like Criteo and The Trade Desk to step in and find new customers. Ms. Martin's stance resonates strongly with me since I opened real-money positions in Criteo, Roku, and The Trade Desk near the market bottom in March. Those positions have returned 40%, 55%, and 157% so far, and all three have a lot of long-term growth left in their tanks.