Software - Application · NASDAQ
Current Price
$24.37
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on The Trade Desk, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Trade Desk, Inc. operates as a technology company in the United States and internationally. The company operates a self-service cloud-based platform that allows buyers to create, manage, and optimize data-driven digital advertising campaigns across various ad formats and channels, including display, video, audio, native, and social on various devices, such as computers, mobile devices, and connected TV. It also provides data and other value-added services. The company serves advertising agencies and other service providers for advertisers. The Trade Desk, Inc. was incorporated in 2009 and is headquartered in Ventura, California.
ROIC (TTM)
13.4%
ROE (TTM)
16.9%
FCF Yield
6.79%
Based on trailing twelve-month data, TTD shows a free cash flow per share of N/A and a ROIC of 13.4%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 6.79% are important context metrics when evaluating TTD's stock valuation relative to peers.
The intrinsic value of TTD depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether TTD is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $24.37. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on The Trade Desk, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Software - Application industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting TTD's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For The Trade Desk, Inc., this means projecting how much free cash flow the Software - Application will produce over the next 5-10 years, then discounting those amounts to today's dollars. TTD's ROIC of 13.4% shows moderate capital returns.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For TTD, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
