Why The Trade Desk Fell Yet Again Today

Shares of The Trade Desk (NASDAQ: TTD) were tumbling again on Tuesday, following yesterday's big sell-off. As of 12:15 p.m. EDT today, shares were down 4.7%, and are now down about 12% week-to-date.

Yesterday, shares were rocked by the announcement that Chief Financial Officer Alex Kayyal, who had been appointed to the role just five months ago, was fired over the weekend. While shares fell on the news, today's subsequent downgrades by not one but three sell-side analysts sent shares another leg lower.

Confirmation of doubts rocks The Trade Desk

On Monday, The Trade Desk announced that CFO Alex Kayyal would be leaving the company, with Chief Accounting Officer Tahnil Davis replacing Kayyal while the company looks for a permanent successor.

The announcement was certainly strange, given that Kayal had been appointed to the position back in August, only five months ago. Kayal also remains on the company's Board of Directors, further complicating matters.

The filing notes Kayyal "was terminated," effective January 24, which is a Saturday, and that he will remain on the Board "through the Company's 2026 annual meeting of stockholders." That seems to indicate that Kayyal will leave the Board after his term ends this year, and that he was fired for some reason. Fortunately, it doesn't appear to be related to last quarter's financials, as the company reiterated its fourth quarter guidance in the filing.

Still, the quick turnover in the C-suite is no doubt unsettling shareholders, who have already seen The Trade Desk's stock plummet 76% from all-time highs amid decelerating revenue.

The firing is also unsettling Wall Street analysts as well. Today, not one but three sell-side analysts at Citigroup, Truist Financial, and Rosenblatt Securities all lowered their price targets on the stock. Citi lowered its price target from $50 to $38, Truist lowered its more bullish price target from $85 to $60, and Rosenblatt lowered its price target from $64 to $53.

Image source: Getty Images.

Where to go from here

The Trade Desk's decline certainly could be an opportunity to buy, but investors should be aware that the stock was extremely expensive before this multi-year decline. After today's decline, shares trade at just around 16 times 2026 adjusted (non-GAAP) earnings per share estimates.

That's pretty cheap for a double-digit grower, but then again, The Trade Desk has been beset by revenue deceleration, concerns over competition, and now, high turnover in the C-suite.

While aggressive investors may want to get involved in the stock down here, more conservative investors may want to hear what management has to say about these issues on its earnings call on February 25.

Citigroup is an advertising partner of Motley Fool Money. Billy Duberstein and/or his clients have positions in The Trade Desk. The Motley Fool has positions in and recommends The Trade Desk and Truist Financial. The Motley Fool has a disclosure policy.