12 Best Growth Stocks to Invest In According to Analysts

5. Trade Desk Inc. (NASDAQ:TTD)

Number of Hedge Fund Holders: 63

Upside Potential as of February 19: 47.47%

Trade Desk Inc. (NASDAQ:TTD) provides a powerful, cloud-based platform that revolutionizes digital advertising. By enabling buyers to plan, manage, and optimize data-driven campaigns across diverse formats and channels, it empowers advertisers to reach their target audiences on a global scale.

The company’s growth is anchored in its AI-powered advertising platform. The Kokai platform, its latest upgrade, is designed to enhance precision and value for clients, driving audience expansion. Retail data offerings are also a focus, which allows clients to measure real-world return on ad spend. Positioning itself within the $1 trillion advertising industry, the company currently manages over $12 billion in ad spend. It’s preparing for potential shifts in the open internet, notably a possible reduction in Google’s involvement, and emphasizing its objectivity as a key differentiator. It’s also pushing Connected TV to become the leading channel in programmatic advertising.

Trade Desk Inc. (NASDAQ:TTD) is driving the adoption of OpenPath for a more efficient supply chain and actively pursuing Joint Business Plans (JBPs) with major brands and agencies, which outpace its general growth by 50%. The company is transitioning all clients to the Kokai platform. Q4 2024 revenue was up 22% year-over-year, with Q1 2025 revenue growth forecasts around 17%. CTV remains a dominant channel, accounting for a high-40s percentage share of the business.

Rowan Street Capital cited this company as their most successful investment, achieving a 54% annualized return due to opportunistic initial purchase during the pandemic and subsequent significant valuation expansion. It said the following regarding Trade Desk Inc. (NASDAQ:TTD) in its Q4 2024 investor letter:

“The Trade Desk (TTD): Investment Initiated: March 2020

Internal Rate of Return (IRR): 54%

The Trade Desk has been our most successful investment to date. March 2025 will mark five years since we opportunistically initiated our position at a cost basis of $17.40 (split-adjusted). Since then, TTD has appreciated more than sevenfold, delivering an annualized return of approximately 54%.

These exceptional results far outpace the company’s strong fundamental growth, with revenues and earnings compounding at approximately 25% annually over this period (refer to the table below). The primary reason for this outsized return lies in the price at which we were able to acquire TTD during the early days of the pandemic, when market fears briefly drove it down to just 10x revenues. Today, the valuation has expanded significantly to approximately 25x revenues, amplifying our returns…” (Click here to read the full text)