The Trade Desk (NASDAQ: TTD) and Alibaba Group Holding Limited (NYSE:BABA) are both mid-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.
Institutional and Insider Ownership
62.8% of The Trade Desk shares are owned by institutional investors. Comparatively, 37.4% of Alibaba Group Holding Limited shares are owned by institutional investors. 26.9% of The Trade Desk shares are owned by insiders. Comparatively, 12.5% of Alibaba Group Holding Limited shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares The Trade Desk and Alibaba Group Holding Limited’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|The Trade Desk||$251.52 million||9.70||$64.25 million||$0.84||71.19|
|Alibaba Group Holding Limited||$26.68 billion||16.98||$11.04 billion||$2.88||61.85|
Alibaba Group Holding Limited has higher revenue and earnings than The Trade Desk. Alibaba Group Holding Limited is trading at a lower price-to-earnings ratio than The Trade Desk, indicating that it is currently the more affordable of the two stocks.
This table compares The Trade Desk and Alibaba Group Holding Limited’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The Trade Desk||13.92%||26.34%||9.17%|
|Alibaba Group Holding Limited||28.77%||16.85%||10.63%|
This is a summary of recent recommendations for The Trade Desk and Alibaba Group Holding Limited, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The Trade Desk||0||1||7||0||2.88|
|Alibaba Group Holding Limited||1||1||30||1||2.94|
The Trade Desk presently has a consensus target price of $57.63, suggesting a potential downside of 3.64%. Alibaba Group Holding Limited has a consensus target price of $167.24, suggesting a potential downside of 6.12%. Given The Trade Desk’s higher probable upside, equities research analysts clearly believe The Trade Desk is more favorable than Alibaba Group Holding Limited.
Alibaba Group Holding Limited beats The Trade Desk on 10 of the 14 factors compared between the two stocks.
The Trade Desk Company Profile
The Trade Desk, Inc. is a technology company. The Company provides a self-service platform that enables clients to purchase and manage digital advertising campaigns across various advertising formats, including display, video and social, and on a range of devices, including computers, mobile devices and connected television. Its platform enables a media planner or buyer at an advertising agency to purchase digital media programmatically on various media exchanges and sell-side platforms; acquire and use third-party data to optimize and measure digital advertising campaigns; deploy their, or their client’s, own first-party data in order to optimize campaign efficacy; link digital campaigns to offline sales results or other business objectives; access other services, such as its data management platform and publisher management platform marketplace, and use its user interface and application programming interfaces (APIs) to build their own technology on top of the Company’s platform.
Alibaba Group Holding Limited Company Profile
Alibaba Group Holding Limited is a holding company. Through its subsidiaries, the Company is engaged in online and mobile commerce through offering of products, services and technology that enable merchants, brands and other businesses to transform the way they market, sell and operate in the People’s Republic of China (China) and internationally. Its businesses consist of core commerce, cloud computing, mobile media and entertainment, and other innovation initiatives. Through investee affiliates, it also participates in the logistics and local services sectors. Retail commerce in China operated by the Company includes the China online commerce destination (Taobao Marketplace); the China third-party platform for brands and retailers (Tmall), and the sales and marketing platform for flash sales (Juhuasuan). Wholesale commerce in China operated by the Company includes the China domestic wholesale marketplace (1688.com) and the wholesale marketplace for global trade (Alibaba.com).
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