There are contrasts between the streaming business stocks: Roku stock ( NASDAQ:ROKU ) and ad-tech platform The Trade Desk stock ( NASDAQ:TTD ), but digital advertising is at the heart of what they both do.
Given this, which of these two stocks is a better purchase right now? Let’s investigate to find out.
Stock Comparison: Roku is Outperforming The Trade Desk.
Looking at revenue estimates from Roku and The Trade Desk, you can see the expectation of difficult times ahead. Roku anticipates third-quarter sales of $700 million , a $20 million (approximately 3%) increase over 2021 Q3 revenue. Compared to a year earlier, when Roku’s 2021 Q3 sales of $680 million marked a 51% year-over-year rise, this suggests a significant deceleration. In contrast, The Trade Desk anticipates $385 million in sales for the third quarter of 2022, a 28% increase over the prior year’s third quarter. The $301 million in sales produced by The Trade Desk during the third quarter of 2021 was a 39% increase over the same period in 2020, indicating that growth is slowing for The Trade Desk, although not nearly as much as Roku’s.
In addition, The Trade Desk is a considerably more lucrative company than Roku. The Trade Desk is a demand-side ad platform that assists businesses in setting up and running ad campaigns; it is a software company with acceptable gross margins of over 82%. The firm has already grown big enough to create positive free cash flow; compare that to Roku’s below.
Roku has developed its demand-side ad platform, Roku OneView, although it is not a pure software company. Consumers may enter the Roku ecosys...
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