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Are Roku and The Trade Desk a Buy Before the Holiday Season?

By Neil Rozenbaum – Oct 11, 2021 at 11:00AM

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These two adtech stocks might see some tailwinds in the coming months.

In this video, I will be talking about Roku (ROKU 1.59%) and The Trade Desk (TTD 4.97%) and the moves both companies have been making this quarter.

Roku

The stock is down 23% since it last reported earnings. One of the main reasons why the stock took a hit is because some old news regarding increased competition with regards to Alphabet and Amazon resurfaced. But regardless, Roku has been making good moves this quarter, and here are some highlights. 

  • Roku is expanding in the U.K. 
  • This Old House, a home improvement TV franchise, will be coming to Roku ad-free but via a subscription. Gusto TV also launches on Roku. While I don't see Roku pouring a lot of money into creating content, I do see it acquiring small franchises that perform well and putting them on the Roku channel, and letting its ad model do its thing.
  • The Roku app is coming to Shopify. This is the first-ever TV streaming advertising app available on Shopify. In the past, only the big brands were able to buy ad spots on TV. And the data you got from it wasn't great. Now thanks to Shopify and Roku, that changes. If you're a small merchant and want to launch an effective ad campaign, you can do it and target the right people.  You know where that will lead us right? You see something you like on TV, and with a press of a button, you are able to order that item. 

The Trade Desk

The stock is down 12% since it last reported earnings, and here are some highlights of what the company has been doing this quarter.

  • The Trade Desk partners up with Vistar Media to support audio out-of-home.  
  • Walmart DSP (demand-side platform) in partnership with The Trade Desk will launch at the end of October, just in time for the holiday season. 
  • Unified ID 2.0 adoption is gathering pace in the U.S. and Europe. 

For the full insights do watch the video below. 

*Stock prices used were the closing prices of October 8, 2021. The video was published on October 10, 2021.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Neil Rozenbaum owns shares of Amazon and Shopify. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Roku, Shopify, and The Trade Desk. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $1,140 calls on Shopify, short January 2022 $1,940 calls on Amazon, and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

Stocks Mentioned

Trade Desk Stock Quote
Trade Desk
TTD
$54.49 (4.97%) $2.58
Walmart Stock Quote
Walmart
WMT
$153.22 (-0.10%) $0.15
Alphabet Stock Quote
Alphabet
GOOGL
$100.44 (-0.55%) $0.55
Amazon.com Stock Quote
Amazon.com
AMZN
$94.13 (-1.44%) $-1.37
Alphabet Stock Quote
Alphabet
GOOG
$100.83 (-0.44%) $0.45
Shopify Stock Quote
Shopify
SHOP
$43.06 (-0.78%) $0.34
Roku Stock Quote
Roku
ROKU
$60.73 (1.59%) $0.95
Shopify Stock Quote
Shopify
SHOP
$57.96 (-0.57%) $0.33

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

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