The Trade Desk, Inc. (TTD) Fair Value & PE Analysis
Software - Services · NASDAQ
Current Price
$19.09
PE Ratio (TTM)
21.4x
Intrinsic Value
$23.86
+20.0% margin of safety
What Is The Trade Desk, Inc.'s Fair Value?
As of 2026-07-29, applying a 21.0x earnings multiple to The Trade Desk, Inc.'s (TTD) earnings per share of $0.91 yields a fair value estimate of $23.86 per share, versus a market price of $19.09.
Fair value from earnings multiples is sensitive to the multiple you choose. Across the sensitivity grid the estimate spans $19.41 to $28.94. This is a relative estimate anchored to earnings, not a statement of fact. For a cash flow based view, see the intrinsic value estimate on the DCF page.
How the PE model works · Recalculate in PE mode · TTD intrinsic value (DCF view)
Is The Trade Desk, Inc. (TTD) Overvalued?
At $19.09, TTD trades about 20.0% below its PE-based fair value estimate, a modest discount to its earnings power, though not enough to call it cheap outright.
COMPETITIVE MOAT
↑Data and Scale Advantage
TTD's extensive data collection and processing capabilities create a significant advantage. This scale allows for more effective ad targeting and campaign optimization.
↑Platform Independence
As an independent ad-tech platform, TTD avoids the conflicts of interest inherent in walled-garden ad systems. This neutrality attracts a broader advertiser base.
↑Technological Innovation
Continuous investment in its platform and AI-driven solutions allows TTD to offer advanced advertising capabilities. This keeps it ahead of competitors in a rapidly evolving market.
INVESTMENT RISKS
↓Regulatory Scrutiny
The digital advertising industry faces increasing regulatory oversight regarding data privacy and ad practices. New regulations could impact TTD's data utilization and business operations.
↓Economic Downturn Impact
Advertising spend is cyclical and highly sensitive to economic conditions. A recession could lead to reduced budgets, impacting TTD's revenue and growth.
↓Technological Disruption
The rapid pace of technological change, including AI advancements and evolving ad formats, presents a constant challenge. TTD must continually innovate to remain competitive.
Base case
TTD base case PE valuation
Intrinsic Value
$23.86
Margin of safety
+20.0%
Expected annual return
+4.6%
Base case assumptions: 10.2% annual earnings growth, 21x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the TTD PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for The Trade Desk, Inc. respond.
Open PE Calculator for TTDCompany Overview
The Trade Desk, Inc. is a global technology company that provides a self-service, cloud-based platform. This platform enables advertising buyers to efficiently create, manage, and optimize data-driven digital ad campaigns across diverse formats and channels, including display, video, audio, native, and social media, reaching audiences on computers, mobile devices, and connected TVs. In addition to the platform, the company offers various data and value-added services. Their primary clients are advertising agencies and other service providers who represent advertisers. The Trade Desk was founded in 2009 and is headquartered in Ventura, California.
Financial Metrics — TTD PE Stock Valuation Data
PE Ratio (TTM)
21.4x
PEG Ratio
2.97
Earnings Yield
4.77%
ROE (TTM)
16.9%
Revenue/Share (TTM)
$6.26
Debt/Equity
0.17x
Frequently Asked Questions
What is the PE ratio of TTD?
The trailing twelve-month PE ratio of TTD reflects how much investors pay per dollar of The Trade Desk, Inc.'s earnings. This metric is most useful when compared to Software - Services peers and the company's own historical range.
Is TTD overvalued based on PE ratio?
TTD's PE of 21.4x combined with a PEG ratio of 2.97 provides a growth-adjusted perspective. A PEG above 2.0 means the P/E is high relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Software - Services, a DCF analysis may be more appropriate.
How do I value TTD stock using PE ratio?
To value The Trade Desk, Inc. using PE: (1) Compare the current PE (21.4x) against the Software - Services median to assess relative pricing, (2) check the PEG ratio (2.97) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of TTD?
TTD's PEG ratio is 2.97, calculated by dividing the PE ratio (21.4x) by the expected earnings growth rate. A PEG above 2.0 means the P/E is high relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for TTD stock valuation?
PE ratio gives a quick relative read — how TTD is priced versus Software - Services peers. DCF provides an absolute value based on projected free cash flows. For TTD, with a strong ROE of 16.9%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See TTD DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Technology valuationsP/E and DCF value TTD with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.