Trade Desk (TTD) Drops 11.9% on PT, Rating Downgrade

Core Viewpoint - The Trade Desk, Inc. (NASDAQ:TTD) experienced a significant decline of 11.95% in stock price, closing at $46.14, following a downgrade by Morgan Stanley from "overweight" to "equal weight" and a reduction in price target from $80 to $50 [1][2]. Group 1: Downgrade and Price Target Adjustment - Morgan Stanley downgraded The Trade Desk due to concerns regarding the sustainability of its growth in the connected TV business, citing execution issues, a soft open web ad market, and increasing competition [2][3]. - The new price target of $50 represents a substantial decrease from the previous target of $80, reflecting the firm's cautious outlook on the company's future performance [1][2]. Group 2: Revenue Growth and Market Challenges - The Trade Desk's guidance for Q3 indicates a revenue growth of only 14%, raising concerns about ongoing challenges following a disappointing Q4:24 performance [3]. - Factors contributing to the negative outlook include pushback from advertisers and the rapid expansion of Amazon's advertising platform, which has recently partnered with Roku and Disney [3][4]. Group 3: Long-term Outlook - Morgan Stanley expressed that fundamental uncertainties and tough comparisons into 2026, along with headwinds in the open web space, suggest limited upside potential for The Trade Desk [4]. - The firm believes that while The Trade Desk has investment potential, other AI stocks may offer better returns with less downside risk [5].