Why The Trade Desk Stock Fell 10.3% in September | The Motley Fool

"Shares of The Trade Desk fell a total of 10.3% in September, according to data from S&P Global Market Intelligence, as sentiment toward the stock remained fragile after a brutal August decline. As investors continued digesting the company's slowing growth and its disappointing third-quarter guidance reported in August, September brought another headwind: new competition for Netflix's ad inventory from a major, deep-pocketed tech giant."

"The Trade Desk runs a demand-side platform, or DSP, that helps marketers buy digital ads across the open internet. In September, attention swung to Netflix's growing ad business after Amazon struck a deal with Netflix to help marketers purchase ad slots from the streaming service alongside other DSPs (including The Trade Desk). The headline itself was not catastrophic, but it reminded investors that Netflix's ad ambitions will attract well-capitalized ad-buying platforms that will compete viciously to get a piece of the growing pie."

Shares fell 10.3% in September after a brutal August decline as sentiment remained fragile. Investors continued digesting slowing revenue growth and disappointing third-quarter guidance. Amazon struck a deal to help marketers buy Netflix ad slots, underscoring that well-capitalized DSPs are moving into Netflix's ad inventory. Microsoft, Alphabet, and Yahoo's DSPs were already working with Netflix alongside The Trade Desk. Intensifying competition could pressure The Trade Desk's influence and pricing power around premium Netflix inventory. The company reported 19% revenue growth and guided for 14% growth, below earlier 25% growth and affected by political ad spending comparisons. The stock trades at about a 58 P/E.

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