Wall Street Wrote It Off — Here’s Why I Added This Tech Sleeper

Stock Bargains

In this latest covered call trade idea, I will highlight a recent addition to my portfolio. One of the things that makes this stock a good covered call candidate is the options against the equity are both lucrative and liquid.

The Trade Desk (TTD) operates a digital advertising platform utilized by advertising agencies and brands to reach relevant audiences to optimize their campaigns across multiple channels.

Digital advertising now commands roughly 80% of the total global advertising spend. Trade Desk has ridden this wave, and revenues grew at an average annual clip of 30% from 2019 to 2024.

The stock peaked in late 2024 and has dropped 80% since. The are several reasons for the selloff. Sales growth has fallen to the low teens annually. The shares were also priced to perfection at their peak.

In addition to nosebleed valuations butting up against growth deceleration, another reason for the drop are concerns over Trade Desk’s position in the CTV (Connected TV) space, which is being threatened by Amazon’s (AMZN) 80 million domestic CTV household reach. Adding to the risk, the hyperscaler and online retailer signed on Netflix (NFLX) as a supplier of inventory in September 2025. There are also worries that AI could disrupt this space, which is a fear that has swept across a lot of industries in recent months.

That said, there was a recent report in the trade journal The Information that stated OpenAI had held early talks to partner with Trade Desk to sell ads. The rumored deal makes sense as OpenAI needs to scale its digital advertising business while Trade Desk could secure access to intent data, which it could deploy across its customer base in CTV and retail to stave off (or at least perceptions of) AI cannibalization. It should be noted that Trade Desk is rapidly integrating AI into its offerings and platform.

One of Trade Desk's most attractive features is its balance sheet. The company is debt free and holds some $1.3 billion of cash and marketable securities. And this was after buying back 26 million of its own shares in 2025. In addition, while growth has slowed, earnings are still projected to grow just over 15% annually over the next couple of years.

Given this, TTD’s valuation of 13 times forward earnings appears attractive in an overbought market. The company’s CEO certainly agrees with that assessment. He purchased nearly $150 million worth of shares in March. Talk about putting your money where your mouth is.

Here is how I established an initial position in the stock this month.

Option Strategy

This is how one can initiate a holding in TTD with a covered call order. As a reminder, covered-call orders involve buying an equity and simultaneously selling just out of the money call strikes against the new position.

Using the October $25 call strikes, fashion a covered call order with a net debit in the $20.00 to $20.40 a share range (net stock price - option premium).

This strategy provides downside protection of 25% with upside potential of nearly 24% even if this stock falls 8% from here over the option duration.

At the the time of publication, Jensen was long AMZN and TTD.