One analyst recently lifted his price target for adtech specialist The Trade Desk's (TTD 1.67%) stock. The raise was significant, however the move does not make this pundit a bull on the up-and-coming stock. In fact, he still believes it is firmly in sell territory.

A bear before and after the latest company update

On Feb. 12, three days before The Trade Desk published its fourth-quarter earnings report, Benchmark's Mark Zgutowicz reiterated his sell recommendation on the stock. At that point, he pegged it as being worth $32 per share. The stock closed Feb. 12 at $73.91.

In Zgutowicz's view, the average analyst revenue estimate for the company were too high. Per his forecast, the The Trade Desk was on course to pull in 4% less revenue than the consensus figure for full-year 2024; in terms of year-over-year comparisons, Zgutowicz was modeling a nearly 21% decline over the 2023 number.

The Trade Desk's fourth-quarter numbers, when released after the market closed on Feb. 15,showed a much higher revenue figure than expected by analysts like Zgutowicz (the company earned $606 million, for 23% year-over-year growth, against the consensus of only $582 million). Non-GAAP (adjusted) earnings increased by 9% to hit $0.41 per share, however that didn't quite reach the $0.43 modeled by those pundits.

A raise does not mean a buy

That inspired Zgutowicz to revise his price target upward, to $42 per share, on Feb. 16. This did not make him a bull, however, as that's still far below The Trade Desk's nearly $89 level as of last Friday's close. He maintained his sell recommendation. In his opinion, the stock's valuations remain too lofty to justify its current price.

The Trade Desk is neck-deep in the ever-growing sphere of digital advertising, and it's proven it can keep the growth engine running while booking a net profit -- and during challenging times for industry, at that. Yet Zgutowicz has a good argument that it's richly valued, so only investors who feel the company can keep producing those solid growth numbers should consider buying the stock.