Key Points

The Trade Desk has lost some of its appeal now that 20% revenue growth rates belong to the past.
Yet its modest P/E ratio and solid fundamentals indicate it could qualify as a value play.
The firm continues to enjoy strong customer retention, and a recent partnership with Roku could draw fresh interest.

Connected TV shares surged in popularity during the pandemic, yet many have tumbled from their peaks. Roku is being purchased at 160 dollars per share after nearing 500 dollars in 2021.

The Trade Desk tells a comparable tale without an acquisition. Shares have fallen more than 50% year to date, and the current price near 18 dollars stands far below the roughly 140 dollars reached late last year.

The Roku transaction has spotlighted The Trade Desk, and its 20.6 P/E ratio invites closer inspection. Here is what investors should consider.

Image source: Getty Images.

The period of 20% growth rates looks finished

One reason The Trade Desk once beat the S&P 500 was its steady delivery of 20% or higher yearly revenue increases. Investors reacted poorly when management signaled those levels had ended.

First-quarter revenue rose 12% from a year earlier, down from 25% growth in the same quarter of 2025. This slowdown remains a key concern, and second-quarter guidance pointed to at least 750 million dollars in sales, equal to roughly 8% yearly growth.

Profit margins narrowed to just under 6%, versus prior double-digit levels. Expansion has slowed, yet retention stays elevated. The company finished the first quarter with retention above 95%, extending a run of more than ten years.

The pullback appears excessive at this stage

Should investors purchase The Trade Desk shares today?

Before buying, note the following.

The Motley Fool Stock Advisor team recently named the 10 top stocks for investors to own now, and The Trade Desk did not appear. The selected names could deliver substantial gains ahead.

Netflix joined the list on December 17, 2004; a 1,000-dollar investment then would be worth 417,305 dollars today. Nvidia was added on April 15, 2005; the same 1,000 dollars would now equal 1,293,148 dollars.

Stock Advisor has produced average returns of 936%, far outpacing the S&P 500's 209%. Review the newest top-10 roster through Stock Advisor and join a community of individual investors.

View the 10 stocks.

Stock Advisor returns as of June 22, 2026.

Marc Guberti holds no positions in the stocks discussed. The Motley Fool owns shares of and recommends Roku and The Trade Desk. The Motley Fool maintains a disclosure policy.

The opinions expressed are those of the author and do not necessarily represent the views of Nasdaq, Inc.