Shares of The Trade Desk (NASDAQ: TTD) jumped on the news that the company will be added to the S&P 500 index.
In pre-market trading on Tuesday, the stock was up 14.05% to $86. The TTD share price closed the last trading session at $75.43, reflecting a year-to-date loss of almost 36%.
The stock is set to start trading on the index at market opening on July 18. The American real-time programmatic marketing company is replacing Ansys following its acquisition by Synopsys.
This inclusion marks a major milestone for the ad tech firm, not only boosting its credibility but also driving demand from index-tracking funds and ETFs that must now hold the stock.
TTD stock prevailing challenges
While this development affirms the company’s growing stature, challenges persist. In its latest quarter, operating expenses increased 21.4% year-over-year to $561.6 million, primarily due to higher investments in platform operations and maintenance. This spending could put pressure on margins if long-term revenue growth slows.
Additionally, The Trade Desk remains heavily dependent on North America, which accounted for 88% of revenue in Q1 2025. To this end, its relatively weak international presence limits the company’s global expansion potential and increases geographic risk.
Despite these concerns, Wall Street remains bullish. For instance, based on 28 analysts’ projections over at TipRanks, the average 12-month price target for TTD is $87.63, with estimates ranging from $48 to $135. The overall consensus is a ‘Strong Buy’.
Among the analysts, Citi’s Ygal Arounian raised his price target from $82 to $90 on July 2, reiterating a ‘Buy’ rating. His outlook is backed by strong industry feedback and optimism around The Trade Desk’s Kokai platform.
Featured image via Shutterstock
