Why The Trade Desk, Inc. Stock Lost 25% in November

Shares of cloud-based advertising platform The Trade Desk, Inc. (NASDAQ: TTD) plunged 25.5% last month, according to data from S&P Global Market Intelligence.

The stock fell 16% after Trade Desk announced third-quarter 2017 earnings on Nov. 9. Revenue increased 50% to $79.4 million, and more impressively, net income of $10.2 million nearly tripled the prior-year quarter's bottom line. However, shares dropped because the company projected fourth-quarter revenue of $101 million, which effectively increased the full-year revenue projection by only $3 million, from $303 million to $306 million. Similarly, Trade Desk projected fourth-quarter EBITDA of $34 million, which nudged the expected full-year EBITDA target from $88 million to $90 million.

The company's guidance disappointed investors because -- as my colleague Rick Munarriz pointed out -- a third quarter that exceeded expectations on both revenue and EBITDA means that Trade Desk is effectively lowering its implied fourth-quarter outlook, given the modest full-year adjustments.

Source: Fool.com