The Trade Desk Stock Has Been Absolutely Pummeled This Year. Is it Finally Time to Buy?

By Daniel Sparks – Feb 25, 2026 at 9:51PM ESTKey PointsThe Trade Desk's revenue growth slowed to 14% year over year in the fourth quarter of 2025.First-quarter 2026 revenue guidance implies about 10% (or greater) year-over-year growth.The company guided for a year-over-year decrease in first-quarter adjusted EBITDA.NASDAQ: TTDThe Trade DeskMarket Cap$12BToday's Changeangle-down(1.12%) $0.28Current Price$25.22Price as of February 25, 2026 at 3:58 PM ETSure, the stock may now trade at a fraction of its all-time high achieved in 2024, but that doesn't automatically make it a buy.Shares of The Trade Desk (TTD +1.12%) have been pummeled in early 2026. And after an already rough stretch, the stock fell sharply in after-hours trading on Wednesday following the company's fourth-quarter results and first-quarter guidance. With such a dramatic stock price crash, it must be time to buy. Right? Not necessarily. Unfortunately, the digital ad-buying specialist's latest report and outlook raised some red flags. And that is on top of another recent chief financial officer change, leaving the company with an interim CFO for now. Image source: Getty Images. Slowing growth and dismal guidance The Trade Desk said fourth-quarter 2025 revenue rose 14% year over year to $847 million. Highlighting how the company's growth has been decelerating, The Trade Desk's revenue grew 25% in the first quarter of 2025, followed by 19% growth in Q2 and 18% growth in Q3. And here's where things get even more concerning. The company's guidance calls for first-quarter 2026 revenue of at least $678 million, implying 10% year-over-year growth. For some companies, double-digit growth like this is fine.

For The Trade Desk, however, it's dismal in the context of its historical growth rates -- and it's even disappointing in the context of its beaten-down valuation. And it is not just the company's revenue setup that is getting weaker.

The Trade Desk guided for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of about $195 million in the first quarter of 2026. This compares to the adjusted EBITDA of $208 million in the first quarter of last year. So the outlook implies both slower revenue growth and lower adjusted EBITDA. That is a tough setup, and indicative of how the growth story has dramatically shifted in recent quarters. A look at The Trade Desk's post-earnings valuation The stock's decline has brought the valuation down meaningfully. But it still isn't priced at a level that makes it a clear buy. After growing its generally accepted accounting principles (GAAP) earnings per share by 15% year over year in 2025 to $0.90, the stock now trades at a price-to-earnings ratio of about 23 (assuming a stock price of about $21). That's not an extreme multiple for a great business -- but it is still a difficult valuation when the company is guiding to 10% revenue growth in Q1 and lower adjusted EBITDA. The other issue is the leadership turnover. The company recently announced another CFO transition and is now operating with an interim CFO while it searches for a permanent successor. There's no rule that says an interim CFO means something is wrong. But it does not help investor confidence at a time when the company needs to execute well. ExpandNASDAQ: TTDThe Trade DeskToday's Change(1.12%) $0.28Current Price$25.22Key Data PointsMarket Cap$12BDay's Range$24.55 - $25.7352wk Range$23.78 - $91.45Volume1.1MAvg Vol14MGross Margin78.81% In its fourth-quarter earnings call on Wednesday, The Trade Desk CEO Jeff Green noted that the company has been operating "against a backdrop of macro uncertainty..." And that may be true. But this uncertain market hasn't stopped some major digital advertising businesses from growing at spectacular rates. Meta Platforms (META +2.14%), for example, grew its fourth-quarter revenue 24% year over year. And Meta's revenue outlook for the first quarter of 2026 is $53.5 billion to $56.5 billion, implying about 30% growth at the midpoint versus first-quarter 2025 revenue of $42.3 billion. Not only does this comparison highlight The Trade Desk's comparatively poor performance in the same macroeconomic environment in which Meta is operating, but it also shows how investors can alternatively buy a faster-growing, more dominant digital advertising business at a comparable earnings multiple. Unfortunately, The Trade Desk stock does not look like a buy today, even after the stock has been crushed. Of course, if the company finds a way to return to faster top-line growth that meaningfully outpaces its cost and expense growth, this could prove to be an excellent entry point in hindsight. But given the first-quarter guidance and the recent trend in the company's growth rate, I would prefer a deeper discount before buying shares.Read NextFeb 18, 2026 •By Trevor Jennewine2 Undervalued AI Stocks to Buy Before They Soar 112% and 196%, According to Certain Wall Street AnalystsFeb 12, 2026 •By Trevor JennewineThe Trade Desk Stock Is Down 81% -- Is It a Buy?

Wall Street Has a Clear Answer for Investors.Feb 8, 2026 •By Keithen DruryPrediction: This Growth Stock Could Outperform the S&P 500 in 2026Feb 8, 2026 •By Keithen DruryThis Stock Up Over 900% in 10 Years Looks Like a Genius Buy Right NowFeb 5, 2026 •By Brett SchaferWhy The Trade Desk Stock Slumped 20% Last MonthFeb 4, 2026 •By Justin PopeShould You Buy The Trade Desk After Its 67% Slump in 2025?About the AuthorDaniel Sparks is a contributing Motley Fool stock market analyst covering technology, industrials, financials, and consumer goods. Daniel is the owner and chief investment officer of Sparks Capital Management. He holds a master’s degree in business administration from Colorado State University. The Globe and Mail profiled him and his investing philosophy in an article titled, “This stock picker is outperforming nearly everybody else. Here’s how he is doing it.”TMFDanielSparksX@sparks_capitalStocks MentionedThe Trade DeskNASDAQ: TTD$25.22 (+1.12%) $+0.28Meta PlatformsNASDAQ: META$652.97 (+2.14%) $+13.67*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.