The Trade Desk Jumps 4% on Walmart Contract Reassurance
Stifel analyst note clarifies the ad-tech firm's exclusive U.S. partnership with the retail giant remains intact, easing investor fears.
Shares of The Trade Desk (TTD) surged more than 4% on Wednesday after an analyst note from Stifel reassured investors about the company's crucial relationship with retail giant Walmart, a key client.
The investment firm reiterated its 'Buy' rating and $90 price target on the digital advertising platform's stock following meetings with company executives. The note clarified that The Trade Desk has not lost its exclusive U.S. contract with Walmart and remains the sole demand-side platform (DSP) provider for the retailer in the country. According to Stifel, the only change to the exclusivity agreement occurred in Mexico, a detail that dispelled market rumors that had pressured the stock.
The clarification provided a much-needed boost for the company, whose shares have been highly volatile and have traded significantly below their 52-week high. The stock had recently been weighed down by concerns over the Walmart partnership, and Wednesday's news prompted a relief rally, with shares closing up 4.2% at $54.88.
This positive catalyst comes after a period of complex investor sentiment for the ad-tech firm. The Trade Desk recently reported second-quarter earnings that beat analyst expectations, with an EPS of $0.41 and revenue of $694 million. However, the stock declined following the earnings report, indicating broader concerns about future prospects in a competitive market.
Despite Wednesday's rally, The Trade Desk's stock is still down more than 50% year-to-date. Stifel's unchanged $90 price target suggests a significant potential upside, underscoring the importance of the company maintaining its strategic partnerships in the growing retail media landscape.