The Trade Desk downgraded by Wedbush amid OpenAI partnership concerns

Core Viewpoint - The Trade Desk has been downgraded to 'Underperform' by Wedbush due to concerns that the potential value of a rumored partnership with OpenAI has been overstated [2] Group 1: Stock Performance and Analyst Ratings - Shares of The Trade Desk traded at $29, above the broker's 12-month price target of $23 [2] - Following reports of a potential partnership with OpenAI, TTD shares surged approximately 18% [3] Group 2: Financial Projections and Valuation - Wedbush estimates that the incremental EBITDA from the potential partnership could reach $42 million in 2027, implying a roughly 53x multiple on the market value gained during the surge [3] - The analysts maintain a $23 price target, indicating that shares are currently overpriced [4] - Under aggressive scenarios, revenue forecasts for The Trade Desk in 2026 range from $31 million to $77 million, and in 2027 from $56 million to $140 million, representing only 1% to 4% of the company's projected revenue base [4] Group 3: Risks and Strategic Considerations - There are concerns about disintermediation as OpenAI develops its own advertising capabilities, which could lead to a decline in TTD's share of advertising spend over time [5] - The analysts noted that no formal deal has been signed, highlighting the risks associated with relying on rumored projections for a partnership that may not materialize [6]