The Trade Desk, Inc. (TTD) Fair Value & PE Analysis
Advertising Agencies · NASDAQ
Current Price
$11.92
PE Ratio (TTM)
14.2x
Intrinsic Value
$10.89
-9.5% margin of safety
What Is The Trade Desk, Inc.'s Fair Value?
As of 2026-10-06, applying a 13.7x earnings multiple to The Trade Desk, Inc.'s (TTD) earnings per share of $0.87 yields a fair value estimate of $10.89 per share, versus a market price of $11.92.
Fair value from earnings multiples is sensitive to the multiple you choose. Across the sensitivity grid the estimate spans $8.49 to $13.69. 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 $11.92, TTD trades about 9.5% above its PE-based fair value estimate, a modest premium over the applied earnings multiple. Check whether earnings growth justifies the price.
COMPETITIVE MOAT
↑Data and Scale Advantage
TTD's extensive data collection and processing capabilities create a significant advantage. This scale allows for more effective audience targeting and campaign optimization.
↑Platform Independence and Neutrality
As an independent platform, TTD avoids conflicts of interest inherent in walled gardens. This neutrality fosters trust and broader adoption by advertisers.
↑CTV Leadership and Ecosystem
TTD's early and strong focus on Connected TV (CTV) has built a robust ecosystem. This positions them to capitalize on the shift from linear TV advertising.
INVESTMENT RISKS
↓Dependence on Ad Spend Cycles
TTD's revenue is directly tied to overall advertising spending, which can be cyclical and sensitive to economic downturns.
↓Technological Disruption (AI)
Advancements in AI could lead to new advertising technologies or automation that bypasses TTD's platform, or require significant adaptation.
↓International Market Volatility
Expansion into diverse international markets like EMEA and APAC presents varying regulatory landscapes and competitive dynamics that could impact growth.
Base case
TTD base case PE valuation
Intrinsic Value
$10.89
Margin of safety
-9.5%
Expected annual return
-1.8%
Base case assumptions: 0.4% annual earnings growth, 13.7x target PE, 10% discount rate, 5 year projection. Data as of 2026-10-06.
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)
14.2x
PEG Ratio
0.14
Earnings Yield
7.29%
ROE (TTM)
16.1%
Revenue/Share (TTM)
$6.38
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 Advertising Agencies peers and the company's own historical range.
Is TTD overvalued based on PE ratio?
TTD's PE of 14.2x combined with a PEG ratio of 0.14 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Advertising Agencies, 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 (14.2x) against the Advertising Agencies median to assess relative pricing, (2) check the PEG ratio (0.14) 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 0.14, calculated by dividing the PE ratio (14.2x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low 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 Advertising Agencies peers. DCF provides an absolute value based on projected free cash flows. For TTD, with a strong ROE of 16.1%, 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 Communication Services 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 2026-10-06. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.