A huge insider buy usually gets investors' attention. And when that insider is a founder and CEO, it gets even more attention.
That is exactly what happened with The Trade Desk (TTD 2.82%) on Thursday. Shares rose about 18% on Thursday after CEO Jeff Green disclosed purchases totaling 6 million shares between March 2 and March 4 at weighted average prices ranging from $23.49 to $25.08. The purchase totaled a staggering $148 million.
A purchase of this size from a founder and CEO warrants consideration. Insider buying of this aggressive suggests Green probably thinks the stock looks undervalued.
This follows a dramatic decline in the stock price recently. Even after the stock's gain on Thursday, shares are down more than 21% year to date and more than 55% over the past 12 months.
The obvious question for investors is, of course, whether they should buy shares, too.
Image source: Getty Images.
A challenging period
At first glance, the company's recent results don't look too bad. In late February, the company reported fourth-quarter revenue of $847 million -- up 14% year over year, or up 19% when excluding political spending from the comparison. Full-year results were solid, too. 2025 revenue rose 18% to $2.9 billion, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the year was $1.2 billion. Further, the company wrapped up 2025 with customer retention remaining above 95% for the 12th consecutive year.
Even more, Green's tone in the company's latest earnings update was notably upbeat, with the CEO noting that he believes the company's "best days" are ahead. In addition, he seemed particularly bullish about the tailwinds that artificial intelligence (AI) can bring to the business.
"I don't think there's any company in our industry that's better positioned to take advantage of advances in AI," Green said.
But there is still one big issue: growth has slowed.
While The Trade Desk's results were solid, its growth profile isn't what it used to be.
Revenue growth in the first, second, third, and fourth quarters of 2025 was 25%, 19%, 18%, and 14%, respectively. And management's first-quarter 2026 guidance called for revenue of at least $678 million. Against first-quarter 2025 revenue of $616 million, that implies growth of only about 10% at the low end.
Of course, the "at least" part in the company's revenue guidance matters. The Trade Desk could (and probably will) beat that number. And Green's insider purchase suggests he thinks the market is overreacting to the recent slowdown.
Still, the bull case for the stock now depends heavily on whether growth can accelerate again.
Why the stock could still work
While Green's purchase doesn't prove the stock is attractive here or eliminate the risks, it does make me more open-minded about turning bullish on the stock at this level. After all, the person with the clearest view into the business just made a massive bet.
Additionally, the stock isn't wildly expensive like it was last year. Even after the growth stock's run-up, shares are trading at 33 times earnings. Of course, a valuation like this doesn't scream bargain either.
Ultimately, there is also a credible path to improvement. If AI, for instance, becomes a catalyst for the company, or if the macroeconomic environment improves, top-line growth could reaccelerate. Additionally, strong platform improvements could do the trick, too.
Of course, the risks are significant. The company operates in a highly competitive industry, competing against the advertising arms of Amazon and Alphabet. Additionally, advertising technology changes quickly.
Amazon's advertising business, in particular, is a legitimate threat because it sits within a large, diversified e-commerce ecosystem with valuable first-party data.
NASDAQ: TTD
Key Data Points
Ultimately, I would not buy this stock simply because Jeff Green did. But his purchase is enough to make me change my mind on the investment -- at least for some investors.
For investors with a high risk tolerance and a long time horizon, I think a small position could make sense here. The business is still strong, the founder just made a massive show of confidence, and the stock is still down dramatically from its levels last year.
But investors should be clear-eyed about what must happen next: Growth needs to reaccelerate. If it does, this beaten-down stock could be a winner. If it doesn't, the valuation could still prove unforgiving.
