Core Insights - The article discusses the investment positions of Parkev Tatevosian, CFA, and mentions that The Motley Fool has positions in and recommends The Trade Desk [1] Company Insights - The Motley Fool has a disclosure policy regarding its investment positions and recommendations [1] - Parkev Tatevosian is affiliated with The Motley Fool and may receive compensation for promoting its services [1]

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends The Trade Desk. The Motley Fool has a disclosure policy. Parkev Tatevosian 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. ...

Group 1 - The Trade Desk (NASDAQ: TTD) reported Q2 2025 earnings, resulting in a significant stock decline of approximately 40% from its pre-earnings price [1] - The focus of Potential Multibaggers is on identifying stocks with the potential for substantial long-term returns, specifically those that could increase 5x-10x or more over the next decade [2] - The investment strategy emphasizes long-term fundamentals over short-term market fluctuations, aiming to provide clarity amidst market noise [2]

Group 1: AI Stock Opportunities - Several AI stocks are considered excellent long-term buys despite the presence of overvalued options in the market [1] - Three notable stocks identified are Alphabet, Taiwan Semiconductor, and The Trade Desk, all expected to see significant growth by 2030 due to undervaluation [2] Group 2: Alphabet (GOOG) - Alphabet, the parent company of Google, primarily generates revenue from its search engine, which is currently under scrutiny due to concerns about generative AI models potentially replacing it [4] - Despite a recent recovery, Alphabet's stock remains cheaper than the S&P 500, trading at a discount compared to its forward earnings [6] - Google Search has integrated AI features, resulting in a 12% year-over-year revenue growth in Q2, indicating strong long-term prospects [6][7] Group 3: Taiwan Semiconductor (TSM) - Taiwan Semiconductor is a key player in the AI arms race, benefiting from increased capital expenditures in data centers [8] - The company projects AI-related revenue to grow at a 45% compound annual growth rate (CAGR) over the next five years, with overall revenue expected to increase at nearly a 20% CAGR [8] - Although its stock trades at 25 times forward earnings, this is considered a reasonable premium given its projected growth, making it an attractive buy [9] Group 4: The Trade Desk (TTD) - The Trade Desk operates a software platform for digital advertising and is transitioning customers to its AI-based product, Kokai, despite facing some challenges [10] - The stock has seen a decline of around 40% from recent highs due to slower growth and market reactions [11] - The digital advertising market continues to expand, and The Trade Desk presents a significant long-term investment opportunity, with potential for explosive returns over the next five years [12]

Core Viewpoint - The Trade Desk's recent stock performance has raised questions about whether the current price presents a buying opportunity despite a significant decline in investor gains over the past few years [1][2]. Group 1: Stock Performance and Valuation - The Trade Desk's stock had previously seen a remarkable 156% gain over two years, trading at high valuation multiples of 134 times free cash flow and 30 times sales [1]. - Recent earnings reports have been strong, but the market reacted negatively, resulting in a loss of several years of investor gains, with a $500 investment five years ago now worth only $576 [2]. - In contrast, the S&P 500 index more than doubled during the same period, achieving a compound annual growth rate (CAGR) of 15.6%, while The Trade Desk's CAGR was only 2.9% [4]. Group 2: Current Valuation and Growth Potential - The Trade Desk's stock is now available at a more reasonable valuation of 33 times free cash flow and 9 times sales, which is still lower than Nvidia's multiples of 62 times free cash flow and 30 times sales [6]. - Despite the less optimistic near-term outlook, management anticipates approximately 14% sales growth in the upcoming third-quarter report, indicating that the growth story is ongoing [9].

Core Insights - The article discusses the investment positions of Parkev Tatevosian, CFA, and mentions that The Motley Fool has positions in and recommends The Trade Desk [1] Company Insights - Parkev Tatevosian has no position in any of the stocks mentioned, indicating a neutral stance on the stocks discussed [1] - The Motley Fool, an investment advisory service, has a vested interest in The Trade Desk, suggesting a potential positive outlook for the company [1]

Core Viewpoint - The Trade Desk's AI-driven programmatic buying platform, Kokai, has faced significant criticism and concerns regarding its impact on the advertising ecosystem, particularly around issues of efficiency, transparency, and market dynamics [2][3][4]. Group 1: Kokai's Introduction and Initial Expectations - Kokai was launched as a next-generation programmatic buying interface, designed to analyze millions of ad opportunities per second and optimize bidding through AI capabilities [2]. - The platform aims to integrate more data into decision-making processes, enhancing advertising effectiveness and accelerating campaign launches [2]. - Despite a 19% revenue growth reported in Q2 2025, investor sentiment remains cautious due to competitive pressures and structural changes in the advertising ecosystem [3]. Group 2: Emerging Concerns and Feedback - Initial feedback from media buyers indicates frustrations with Kokai, citing issues such as slower-than-expected rollout and mixed experiences with the platform [3][4]. - Concerns have been raised about the potential downgrading of existing supply chain relationships, as the algorithm appears to prioritize direct connections over traditional inventory channels [4][6]. Group 3: Conflicts Within the Ecosystem - The controversy surrounding Kokai highlights three key tensions: 1. The conflict between efficiency and neutrality, where prioritizing direct channels may redistribute traffic and revenue away from established publishers [6]. 2. The tension between opacity and the need for explanation, as stakeholders seek clarity on algorithmic decisions affecting budget allocations [7]. 3. The conflict between short-term performance and long-term ecosystem health, where immediate gains may undermine the diversity and resilience of the advertising landscape [8]. Group 4: Perspectives of Different Stakeholders - Buyers appreciate the convenience Kokai offers, such as automated budget allocation and cross-channel predictions, but face challenges when default optimization strategies conflict with existing purchasing habits [9]. - Sellers are drawn to the promise of transparency and precision but may experience negative impacts if their inventory is marked as suboptimal by the algorithm [9]. - For The Trade Desk, Kokai represents a critical component of its growth strategy, yet concerns about platform neutrality complicate its path forward [9]. Group 5: Future Implications and Industry Reflection - The rapid emergence of these concerns reflects the shift from AI as an auxiliary decision-making tool to an automated decision-making system, amplifying the impact of default settings on profit distribution [10]. - The rise of connected TV (CTV) and retail media has further fragmented the advertising inventory landscape, making any optimization logic potentially transformative for market dynamics [10]. - The industry is now focused on The Trade Desk's next steps regarding Kokai, particularly in terms of enhancing path diversity and providing clearer causal analysis in reporting [11][12].

Core Insights - Trade Desk (TTD.US) may face the risk of losing Walmart (WMT.US) as a key client due to dissatisfaction with high fees and the renegotiation of their partnership [1][2] - Walmart has gained the option to use other advertising purchasing platforms, potentially benefiting competitors like Amazon (AMZN.US) [1] - Amazon has been increasing its efforts in online advertising sales and has lowered its fees to attract advertisers away from Trade Desk [1] Group 1 - Trade Desk was previously the exclusive technology provider for advertisers using Walmart's customer data for online advertising [1] - Walmart's dissatisfaction stems from Trade Desk charging double-digit rates for its services, while Amazon has reduced its fees to 1% from previous rates of 5% and 7% [1] - A Trade Desk employee indicated that Walmart is protective of its customer shopping data to prevent it from falling into Amazon's hands [2] Group 2 - Trade Desk has developed an independent version of its technology for Walmart, which operates on Microsoft's Azure platform, although much of its business still relies on Amazon Web Services (AWS) [2] - There are indications that Walmart may consider acquiring existing advertising purchasing platforms or developing its own from scratch [2]

Group 1: Market Overview - Changing market themes and sector rotations have left some formerly dominant companies trailing the broader rally, raising questions about whether these "left behind" stocks represent a buying opportunity [1] - Bespoke Investment Group identified large-cap "left behind" stocks, highlighting that some well-known companies have performed poorly recently [2] Group 2: Company-Specific Insights - UnitedHealth Group, facing cost pressures and regulatory challenges, is currently trading at five-year lows, with a 57.4% decline from its 52-week high of $630.73 to $268.92, but analysts believe its market dominance and revenue potential could lead to a recovery [3][7] - Lululemon Athletica has seen a significant drop due to shifting consumer trends and increased competition, yet it retains strong brand equity and growth prospects, particularly in international and male apparel segments, suggesting a potential entry point for long-term investors [4] - The Trade Desk continues to show strong revenue growth despite challenges in the digital advertising sector, with a 61.6% decline from its 52-week high of $141.53, and analysts argue that the stock may be undervalued, presenting an opportunity for investors willing to overlook recent volatility [5][7] Group 3: Investment Strategy - Analysts suggest that some of the identified "left behind" stocks are likely to recover over the next year, emphasizing the investment strategy of buying low and selling high [6]

Group 1 - The Trade Desk's stock price has decreased by 21.68% since the last coverage on June 18, 2025 [1] - The company is recognized for its focus on technology stocks, reflecting a trend among investors with engineering backgrounds [1] Group 2 - The article expresses the author's personal opinions and indicates a beneficial long position in The Trade Desk shares [1]