KeyBanc Sees Trade Desk Gaining Out Of EU Crackdown On Alphabet, Meta

Given continued scrutiny on Alphabet Inc GOOG GOOGL and Meta Platforms Inc META, KeyBanc sees a higher probability of regulators requiring walled gardens to open up inventory to demand side platforms (DSPs).
Analyst Justin Patterson sees a ~50% probability of Alphabet making concessions on AdTech to the EU, which could prompt similar actions by Meta.
Also Read: Facebook, Twitter, Google Set To Face Hefty EU Fines If Found Not Tackling Fake Accounts
Patterson's view is that Overweight-rated The Trade Desk, Inc TTD is the biggest beneficiary of any change.
Related: British Antitrust Watchdog Comes After Apple, Google: All You Need To Know
Focusing strictly on Europe, Patterson estimate 2023E revenue and EBITDA accretion of 21% and 30%, respectively (assuming 20% share of YouTube, 5% of FB, and 10% take rates), and a potential lift in share price to $72 (vs. its $55 price target).
For GOOGL and META, Patterson views revenue loss as negligible vs. potential fines.
Related: French Regulator Reaches Truce With Facebook Owner Meta Over Online Ads
Price Action: TTD shares traded lower by 7.35% at $44.60 on the last check Thursday.