We recently published a list of the 15 Best Growth Stocks to Buy for the Next 3 Years. In this article, we are going to take a look at where Trade Desk Inc. (NASDAQ:TTD) stands against other growth stocks to buy for the next 3 years.

On April 29, Dan Ives of Wedbush Securities joined ‘Power Lunch’ on CNBC to discuss his outlook for the tech sector and expressed that tariffs aren’t stopping the AI revolution. According to Ives, the critical question for the sector was whether spending, particularly CapEx, was being maintained. He expressed confidence that CapEx was holding up and predicted that the forthcoming results from big tech companies would serve more as a confidence booster for the market, rather than fueling the existing fears. As some investors are of the idea that concerns about a potential soft patch in the economy remain, there’s a preference for safer investments in insurance and other stable sectors, rather than big tech. However, Ives acknowledged that while uncertainty had been prevalent in recent weeks, his own survey work and field research indicate that AI-related spending stays strong. He noted that, while there were areas of the cloud sector where spending was accelerating, the overall uncertainty would likely result in broad guidance ranges from companies.

Michael Darda, the Managing Director, Chief Economist, and Macrostrategist at ROTH, also believes that AI would generate solid returns in the future. Ives agreed with Darda’s assessment and stated that enterprises were seeing similar advancements and could not afford to leave their AI projects behind without the risk of consequently falling behind. He also pointed out that for companies like those in the MAG7, the AI revolution is a central theme, which is why challenges brought forward by tariffs would not impact the AI revolution as much. Darda changed his outlook from bearish to bullish on tech and AI recently due to his personal experience with AI tools, which he felt had improved over the past year.

Dan Ives reiterated that, despite the uncertainty created by tariffs, the demand for software remained a safety blanket, and spending by hyperscale companies is expected to continue.

Our Methodology

We sifted through financial media reports to compile a list of the top growth stocks to buy for the next 3 years. We then selected 15 stocks with a 3-year revenue compound annual growth rate of over 20%. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024, which was sourced from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A large array of computer screens and tech equipment representing the technology company's self-service cloud-based platform.

Trade Desk Inc. (NASDAQ:TTD)

3-Year Revenue CAGR: 26.90%

Number of Hedge Fund Holders: 63

Trade Desk Inc. (NASDAQ:TTD) is a technology company that offers a self-service cloud-based ad-buying platform. This allows buyers to plan, manage, optimize, and measure data-driven digital advertising campaigns across various ad formats and channels. These include video, display, audio, digital-out-of-home, native, and social.

As a leading cloud-based ad-tech platform, Trade Desk connects advertisers with ad-inventory suppliers across streaming, TV, mobile, and out-of-home displays. The company manages over $12 billion in ad spend within a $1 trillion ad industry. This growth is anchored in its AI-powered advertising platform, called Kokai. Trade Desk Inc. (NASDAQ:TTD) is now transitioning all clients to the Kokai platform.

The company outpaced nearly every segment of digital advertising in 2024 and delivered $2.4 billion of revenue. This was up 26% year-over-year. However, on March 18, Justin Patterson, an analyst at KeyBanc, lowered the price target on the stock to $74 from $130 while keeping his Overweight rating. Trade Desk Inc. (NASDAQ:TTD) is actively exploring ways to integrate AI across its suite of products.

Rowan Street Capital highlighted the company’s strong fundamental growth and stated the following regarding The Trade Desk, Inc. (NASDAQ:TTD) in its Q4 2024 investor letter:

“The Trade Desk (TTD): Investment Initiated: March 2020

Internal Rate of Return (IRR): 54%

The Trade Desk has been our most successful investment to date. March 2025 will mark five years since we opportunistically initiated our position at a cost basis of $17.40 (split-adjusted). Since then, TTD has appreciated more than sevenfold, delivering an annualized return of approximately 54%.

These exceptional results far outpace the company’s strong fundamental growth, with revenues and earnings compounding at approximately 25% annually over this period (refer to the table below). The primary reason for this outsized return lies in the price at which we were able to acquire TTD during the early days of the pandemic, when market fears briefly drove it down to just 10x revenues. Today, the valuation has expanded significantly to approximately 25x revenues, amplifying our returns…” (Click here to read the full text)

Overall, TTD ranks 10th on our list of the best growth stocks to buy for the next 3 years. While we acknowledge the growth potential of TTD, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TTD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.