Almost every company involved in the advertising industry has seen a slowdown in business thanks to a slowing economy -- except for The Trade Desk (TTD -0.34%). While it doesn't directly buy or sell ads, The Trade Desk's ad bidding software is crucial in successfully deploying ads in the modern environment.

Despite its business strength, the stock was down over 50% in 2022. However, 2023 looks like a strong rebound year for the stock, and many savvy investors are piling in. Here's why.

The Trade Desk has a better solution for protecting consumer information

The Trade Desk's buy-side platform helps advertisers automatically bid on the best location for its ads across the internet -- whether on a podcast, on connected TV, or in the margins of a webpage. In the past, tracking cookies were the primary means to identify the preferences of the consumer viewing the ad. Due to various security concerns, cookies will be discontinued by Alphabet in 2024, although this has been delayed multiple times already.

To remedy losing this tracking method, The Trade Desk developed its Unified ID 2.0 (UID2) technology. UID2 represents an upgrade from cookies, allowing more precise tracking by creating an anonymous ID and associating it with an email address. This allows the ID to follow the customer from their cellphone to their tablet to their preferred TV streaming device.

With a best-in-class product and game-changing technology in a growing industry, The Trade Desk's business story looks like a no-brainer. Fortunately for investors, its financials back up this narrative.

Profits are temporarily suppressed

In Q3, The Trade Desk's revenue rose 31% to $395 million -- it also maintained at least 95% of its customers, continuing its eight-year streak. So even with a weak advertising environment, customers are using The Trade Desk more and not leaving the platform.

This stickiness is vital when considering if a business can weather an economic downturn.

Unlike most rapidly growing tech stocks, The Trade Desk is also profitable.

It posted $0.03 in earnings per share (EPS) in Q3, although this was heavily offset by a one-time stock grant to its CEO Jeff Green. Without this expense that has been a drag on 2022's earnings, The Trade Desk would have posted $0.17 EPS in Q3 -- a 40% increase over last year's EPS. This pay package came in the form of a stock option grant, which will only be worth anything if the stock price dramatically increases. When the CEO's pay is aligned with long-term stock performance, it should excite investors, as management will only make money if shareholders do.

Looking into next year, analysts expect revenue growth of 21% with $1.07 in EPS. That values The Trade Desk around 43 times earnings -- not cheap, but not terribly expensive either, especially considering the company's young and growing state.

Investors will have to see what management says about its 2023 outlook in its Q4 earnings report, most likely in early February. But, with how strong the tailwinds are blowing in favor of the ad tech industry, The Trade Desk will likely project another solid year.

I think The Trade Desk will have a great rebound year in 2023, and investors should pick up some shares before the stock really gains momentum.