The Trade Desk's DCF Stock Analysis. Buy or Sell?

The Trade Desk's DCF Stock Analysis

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The Trade Desk’s DCF Stock Analysis

Here’s my assumptions:

Risk Free Rate (10 Years Interest Rate Swap): 4.164%

Risk Premium (Taken from the Aswath Damodaran equity premium spreadsheet): 4.33%

Interest Rate Spread on The Risk free rate ( For the cost of debt calculation): 1.5%

Historical Data

Revenue growth in the last 10 years (CAGR): 35.90%

Earnings growth in the last 10 years (CAGR): 37.82%

Unlevered Free Cash Flow growth in the last 9 years (CAGR)- First year with positive FCF: 26.59%

Future Assumptions

End of Year FCF growth: 10%

Growth until end of 2026: 20%

Growth until end of 2034: 10%

Perpetual growth: 3.1%

Net Debt: -1.405B (Positive)

Outstanding Stock Options Present Value Assumption: $0.232B

Restricted Stock Units Present Value Assumption: $0.683B

Stock Valuation based on these assumptions: $46.8

Last update 06/15/2025

Data Source for the analysis: SEEKING ALPHA

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All the content in this newsletter should be taken as informational content only. THIS IS NOT FINANCIAL ADVICE! Do your own Due Diligence before investing or contact a professional financial advisor.

I don’t have a position in The Trade Desk (TTD) and I don’t plan to add a position in the coming days.