How Netflix Earnings Can Impact This Holding

After today’s market close, we will hear from Netflix NFLX when it reports its quarterly results, including a number of metrics Wall Street will be digging into.

Because of our position in Trade Desk TTD, we’ll be focusing more on the mix of its subscriber base with an emphasis on those utilizing its ad-supported offering. That tier utilizes a combination of pre-roll, mid-roll and post-roll ads similar to ones used by other streaming platforms.

Heading into that report JMP Securities initiated coverage on TTD shares with a $150 target and an outperform rating earlier on Tuesday. We agree with JMP’s assessment that the Trade Desk stands to benefit from the ongoing shift of the $166 billion linear TV advertising spend to Connected TV (CTV). Based on what we learn from Netflix’s results and guidance, we’ll revisit our current TTD price target of $140 and, if necessary, our current Two rating.

Trump and AI

We are seeing word that President Trump will announce an investment to build AI infrastructure in the U.S.

Reports indicate OpenAI, Softbank and Oracle ORCL are planning a JV called Stargate with plans to commit $100 billion in initial funding. Stargate is expected to begin with a data center project in Texas and eventually expand to other states. During Tuesday afternoon’s announcement, we’ll look to see if Trump backs Stargate with federal funding, and if so, how that may tie with the wave of announcements made on Monday and earlier on Tuesday.

We see this announcement supporting our view we are in an AI arms race between Big Tech companies. It’s also another positive development for our shares of Nvidia NVDA and Marvell MRVL.

More Pro Portfolio

At the time of publication, TheStreet Pro Portfolio was long TTD, NVDA and MRVL.