There’s one company that Oppenheimer analyst Jason Helfstein believes is set up to be a big winner now that President Biden has ended his campaign for re-election.
Political advertising is expected to accelerate after Biden’s move, Helfstein said, no matter who becomes the Democrats’ nominee for president.
Advertising-technology company Trade Desk Inc. TTD, +0.30% should “disproportionately benefit” from the boost to political ads.
Read: Biden’s out. This is what matters to the stock market now.
The stock jumped 1.5% in premarket trading. It has run up 33.4% year to date through Friday, while the S&P 500 index SPX has gained 15.4%.
Helfstein has had a bullish outperform rating on Trade Desk’s stock for at least the past three years.
His $ 120 stock price target, which implies a 25% upside from Friday’s close, makes him the most bullish of the 35 analysts surveyed by FactSet who cover the stock.
Trade Desk, which had a market capitalization of about $ 47 billion as of Friday’s close, touts itself as a technology company that empowers buyers of advertising. The company’s cloud-based platform allows ad buyers to create and manage digital advertising campaigns across formats and devices.
Helfstein said he was expecting political ad revenue of $ 45 million in 2024, which represents roughly 2% of the FactSet consensus for a total 2024 revenue of $ 2.42 billion. In 2020, the company had $ 47 million in political ad revenue.
But with Biden dropping out, the outlook for political ad revenue will increase, Helfstein said.
He noted that media industry consultant MAGNA currently forecasts political ad spending of $ 9 billion this year, compared with $ 8.1 billion spent in 2020.
Trade Desk could provide an update on its outlook when it releases its second-quarter results on Aug. 8.
Helfstein said visual-messaging company Snap Inc. SNAP, -1.17% will also benefit from Biden dropping out, but to a lesser extent.
He’s been neutral on Snap’s stock for the past two years, and doesn’t have a price target.
Snap’s stock climbed 1.1% ahead of Monday’s open. It has dropped 14.9% this year.