The Trade Desk, Inc. (TTD) and DocuSign, Inc. (DOCU) are two prominent players in the software application industry, each driving innovation in digital solutions with distinct market approaches. TTD focuses on data-driven digital advertising platforms, while DOCU leads in electronic signature and contract management software. Both companies compete in the broader technology sector, offering growth potential through cutting-edge services. This analysis will help you identify which company presents the most compelling investment opportunity.
Table of contents
Companies Overview
I will begin the comparison between The Trade Desk and DocuSign by providing an overview of these two companies and their main differences.
The Trade Desk Overview
The Trade Desk, Inc. operates a cloud-based self-service platform that enables buyers to create, manage, and optimize data-driven digital advertising campaigns across multiple formats and devices. Founded in 2009 and headquartered in Ventura, California, it serves advertising agencies and service providers. The company is positioned as a technology leader in the software application industry with a market cap of approximately 17.3B USD.
DocuSign Overview
DocuSign, Inc. provides electronic signature software and related contract lifecycle management solutions to businesses internationally. Established in 2003 and based in San Francisco, California, DocuSign’s offerings include AI-driven tools for agreement preparation, signing, and management. It caters to enterprise, commercial, and small businesses with a market cap near 11.4B USD, operating in the software application sector.
Key similarities and differences
Both companies operate in the technology sector focusing on software applications but serve distinct markets: The Trade Desk targets digital advertising, while DocuSign specializes in electronic signature and contract management solutions. Each utilizes cloud-based platforms to deliver services globally, yet their business models differ—advertising campaign optimization versus document lifecycle automation. Their employee counts and market capitalizations also reflect their differing scales and market focus.
Income Statement Comparison
The table below compares key income statement metrics for The Trade Desk, Inc. and DocuSign, Inc. for their most recent fiscal years, providing a snapshot of their financial performance.
| Metric | The Trade Desk, Inc. (TTD) | DocuSign, Inc. (DOCU) |
|---|---|---|
| Market Cap | 17.3B | 11.4B |
| Revenue | 2.44B (2024) | 2.98B (2025) |
| EBITDA | 515M (2024) | 357M (2025) |
| EBIT | 427M (2024) | 249M (2025) |
| Net Income | 393M (2024) | 1.07B (2025) |
| EPS | 0.80 (2024) | 5.23 (2025) |
| Fiscal Year | 2024 | 2025 |
Income Statement Interpretations
The Trade Desk, Inc.
The Trade Desk, Inc. demonstrated strong growth in revenue and net income from 2020 to 2024, with revenue nearly tripling to $2.44B and net income rising to $393M. Margins showed resilience, with a gross margin of 80.7% and net margin at 16.1%, despite a slight decline over the period. In 2024, the company saw a robust 25.6% revenue increase and more than doubled its EBIT, reflecting improved operational efficiency.
DocuSign, Inc.
DocuSign, Inc. experienced steady revenue growth from 2021 to 2025, reaching $2.98B in 2025, and a substantial turnaround in net income to $1.07B. Margins improved notably, with gross margin stable near 79.1% and net margin expanding to 35.9%. The latest fiscal year showed moderate 7.8% revenue growth but a significant surge in net margin and EPS, indicating enhanced profitability and financial health.
Which one has the stronger fundamentals?
Both companies present favorable fundamentals, yet The Trade Desk exhibits stronger margin stability and faster revenue growth, with a 92.9% favorable income evaluation. DocuSign, while showing impressive net income growth and margin expansion, has a neutral EBIT margin and slower revenue growth. The Trade Desk’s consistent margin performance contrasts with DocuSign’s recent profitability improvements, offering distinct fundamental strengths.
Financial Ratios Comparison
The table below presents key financial ratios for The Trade Desk, Inc. (TTD) and DocuSign, Inc. (DOCU) for their most recent fiscal years, providing a snapshot of their profitability, liquidity, leverage, and market valuation.
| Ratios | The Trade Desk, Inc. (TTD) 2024 | DocuSign, Inc. (DOCU) 2025 |
|---|---|---|
| ROE | 13.3% | 53.3% |
| ROIC | 10.0% | 9.1% |
| P/E | 147 | 18.5 |
| P/B | 19.6 | 9.87 |
| Current Ratio | 1.86 | 0.81 |
| Quick Ratio | 1.86 | 0.81 |
| D/E | 0.106 | 0.062 |
| Debt-to-Assets | 5.1% | 3.1% |
| Interest Coverage | 0 (not reported) | 129 |
| Asset Turnover | 0.40 | 0.74 |
| Fixed Asset Turnover | 5.17 | 7.28 |
| Payout ratio | 0 | 0 |
| Dividend yield | 0 | 0 |
Interpretation of the Ratios
The Trade Desk, Inc.
The Trade Desk exhibits mostly favorable financial ratios, including a strong net margin of 16.08% and a return on invested capital of 10.02%, indicating operational efficiency. The company maintains a healthy current ratio of 1.86 and low debt levels, but its high P/E ratio of 146.77 suggests overvaluation risk. The company does not pay dividends, reflecting a focus on reinvestment and growth.
DocuSign, Inc.
DocuSign shows a favorable net margin of 35.87% and an impressive return on equity of 53.32%, signaling high profitability and effective capital use. However, its current ratio is weak at 0.81, indicating potential liquidity concerns. The P/E ratio is reasonable at 18.51, but the price-to-book ratio is unfavorable at 9.87. DocuSign also does not pay dividends, prioritizing reinvestment and innovation.
Which one has the best ratios?
The Trade Desk’s ratios are globally favorable with a solid liquidity position and moderate risk from valuation multiples. DocuSign demonstrates stronger profitability but faces liquidity weaknesses and mixed valuation metrics. Considering the balance of factors, The Trade Desk’s financial metrics offer a more consistent profile, while DocuSign shows higher risk and reward potential through its profitability and capital structure.
Strategic Positioning
This section compares the strategic positioning of The Trade Desk, Inc. and DocuSign, Inc., including market position, key segments, and exposure to technological disruption:
The Trade Desk, Inc.
- Operates in digital advertising with significant market presence under competitive pressure.
- Focuses on cloud-based platform for managing data-driven digital advertising campaigns across formats and devices.
- Faces technological disruption from evolving digital advertising channels and formats.
DocuSign, Inc.
- Provides electronic signature software with broad market reach amid competitive software sector.
- Key segments include subscription services and professional services driving revenue growth.
- Exposed to technology shifts through AI-driven contract lifecycle management and digital workflows.
The Trade Desk, Inc. vs DocuSign, Inc. Positioning
The Trade Desk pursues a concentrated strategy in digital advertising technology, while DocuSign offers diversified e-signature and agreement management solutions. Trade Desk benefits from specialization; DocuSign’s broad portfolio supports multiple industries but may face complexity in integration.
Which has the best competitive advantage?
DocuSign shows a slightly favorable moat with improving profitability and growing ROIC, suggesting strengthening competitive advantage. The Trade Desk’s declining ROIC indicates a slightly unfavorable moat and challenges in sustaining value creation.
Stock Comparison
The stock price movements of The Trade Desk, Inc. and DocuSign, Inc. over the past year reveal contrasting trends, with notable price swings and shifting trading volumes influencing investor sentiment.
Trend Analysis
The Trade Desk, Inc. experienced a bearish trend over the past 12 months, with a significant price decline of 56.43% and decelerating momentum. The stock showed high volatility, ranging from a high of 139.11 to a low of 35.48.
DocuSign, Inc. demonstrated a bullish trend with a 9.63% price increase over the same period, albeit with deceleration. The stock’s price fluctuated between 50.84 and 106.99, reflecting moderate volatility.
Comparing both stocks, DocuSign has delivered the highest market performance over the past year, outperforming The Trade Desk despite recent downward pressure on both equities.
Target Prices
The current analyst consensus provides a varied but insightful outlook on these technology companies.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| The Trade Desk, Inc. | 98 | 39 | 56.73 |
| DocuSign, Inc. | 88 | 70 | 76.86 |
Analysts expect The Trade Desk’s stock to appreciate notably from its current price of 35.48, while DocuSign’s consensus target suggests moderate upside potential compared with its current price of 56.71.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for The Trade Desk, Inc. (TTD) and DocuSign, Inc. (DOCU):
Rating Comparison
TTD Rating
- Rating: B, classified as Very Favorable overall rating.
- Discounted Cash Flow Score: 4, indicating a Favorable valuation outlook.
- ROE Score: 4, showing favorable efficiency in generating profit.
- ROA Score: 4, reflecting favorable asset utilization.
- Debt To Equity Score: 3, indicating moderate financial risk.
- Overall Score: 3, considered a Moderate financial standing.
DOCU Rating
- Rating: B+, classified as Very Favorable overall rating.
- Discounted Cash Flow Score: 5, indicating a Very Favorable valuation outlook.
- ROE Score: 4, showing favorable efficiency in generating profit.
- ROA Score: 4, reflecting favorable asset utilization.
- Debt To Equity Score: 3, indicating moderate financial risk.
- Overall Score: 3, considered a Moderate financial standing.
Which one is the best rated?
DOCU holds a slightly stronger position with a B+ rating and the highest discounted cash flow score of 5, compared to TTD’s B rating and DCF score of 4. Both have identical scores on ROE, ROA, debt to equity, and overall metrics.
Scores Comparison
The financial scores comparison of The Trade Desk, Inc. and DocuSign, Inc. is as follows:
TTD Scores
- Altman Z-Score: 4.30, indicating a safe zone, low bankruptcy risk.
- Piotroski Score: 5, representing average financial strength.
DOCU Scores
- Altman Z-Score: 4.43, indicating a safe zone, low bankruptcy risk.
- Piotroski Score: 5, representing average financial strength.
Which company has the best scores?
Both The Trade Desk and DocuSign show Altman Z-Scores in the safe zone, with DocuSign slightly higher. Their Piotroski Scores are equal at 5, indicating comparable average financial strength based on the data provided.
Grades Comparison
The following presents the recent grades assigned to The Trade Desk, Inc. and DocuSign, Inc. by reputable financial institutions:
The Trade Desk, Inc. Grades
Here is a summary of recent grading actions from established analysts for The Trade Desk, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Morgan Stanley | Maintain | Equal Weight | 2026-01-13 |
| Wells Fargo | Maintain | Equal Weight | 2026-01-12 |
| Cantor Fitzgerald | Maintain | Neutral | 2026-01-08 |
| Wolfe Research | Maintain | Outperform | 2026-01-06 |
| Guggenheim | Maintain | Buy | 2026-01-05 |
| Jefferies | Maintain | Hold | 2025-12-11 |
| Wedbush | Maintain | Neutral | 2025-12-08 |
| DA Davidson | Maintain | Buy | 2025-11-10 |
| Truist Securities | Maintain | Buy | 2025-11-07 |
| Wells Fargo | Maintain | Equal Weight | 2025-11-07 |
The grades for The Trade Desk show a mix of Buy, Hold, Neutral, and Equal Weight ratings, with a consensus leaning towards Buy.
DocuSign, Inc. Grades
Below is the recent grading data from recognized analysts for DocuSign, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| RBC Capital | Maintain | Sector Perform | 2026-01-05 |
| Evercore ISI Group | Maintain | In Line | 2025-12-05 |
| UBS | Maintain | Neutral | 2025-12-05 |
| Wells Fargo | Maintain | Equal Weight | 2025-12-05 |
| Piper Sandler | Maintain | Neutral | 2025-12-05 |
| RBC Capital | Maintain | Sector Perform | 2025-12-05 |
| JP Morgan | Maintain | Neutral | 2025-12-05 |
| B of A Securities | Maintain | Neutral | 2025-12-05 |
| Needham | Maintain | Hold | 2025-12-05 |
| Baird | Maintain | Neutral | 2025-12-05 |
DocuSign’s ratings predominantly consist of Neutral, Hold, and Sector Perform grades, with the consensus rated as Hold.
Which company has the best grades?
The Trade Desk, Inc. has received generally more positive grades, including multiple Buy ratings and an overall consensus of Buy, compared to DocuSign, Inc.’s Hold consensus with mostly Neutral ratings. This suggests a comparatively stronger analyst sentiment for The Trade Desk, which could influence investor confidence accordingly.
Strengths and Weaknesses
Below is a comparative table highlighting the key strengths and weaknesses of The Trade Desk, Inc. (TTD) and DocuSign, Inc. (DOCU) based on the most recent financial and operational data.
| Criterion | The Trade Desk, Inc. (TTD) | DocuSign, Inc. (DOCU) |
|---|---|---|
| Diversification | Focused on digital advertising, limited product range | Strong subscription-based model, expanding services |
| Profitability | Net margin 16.1%, ROIC 10.0%, slightly shedding value | Net margin 35.9%, ROIC 9.1%, profitability growing |
| Innovation | Solid innovation in programmatic advertising | Continuous product enhancement in e-signature tech |
| Global presence | Established global footprint in advertising markets | Global SaaS reach, broad customer base worldwide |
| Market Share | Leading in digital ad tech but facing rising competition | Strong market share in e-signature and contract mgmt |
Key takeaways: TTD shows favorable profitability ratios but struggles with declining ROIC and high valuation multiples, indicating risk. DOCU demonstrates robust profitability growth and market expansion, though some liquidity ratios are weaker. Investors should weigh TTD’s solid innovation against its profitability challenges, while DOCU’s growth trajectory looks promising but requires monitoring of balance sheet strength.
Risk Analysis
Below is a comparison of key risks faced by The Trade Desk, Inc. (TTD) and DocuSign, Inc. (DOCU) based on the most recent data from 2025-2026:
| Metric | The Trade Desk, Inc. (TTD) | DocuSign, Inc. (DOCU) |
|---|---|---|
| Market Risk | High beta (1.105) indicates moderate market volatility exposure | Beta near 1 (0.994) suggests market risk aligned with overall market |
| Debt level | Low debt-to-equity (0.11) and debt-to-assets (5.11%) – favorable | Very low debt-to-equity (0.06) and debt-to-assets (3.1%) – favorable |
| Regulatory Risk | Moderate, due to digital advertising regulations and data privacy laws | Moderate, with evolving e-signature and data security regulations |
| Operational Risk | Moderate, reliant on cloud platform stability and ad tech innovation | Moderate, depends on software reliability and integration with CRM platforms |
| Environmental Risk | Low, technology sector with limited direct environmental impact | Low, primarily software services with minimal environmental footprint |
| Geopolitical Risk | Moderate, global advertising markets exposure | Moderate, international operations subject to geopolitical tensions |
The most impactful and likely risks center on market volatility and regulatory changes. TTD faces pressure from data privacy regulations affecting ad targeting, while DOCU must navigate evolving compliance in digital signatures. Both companies maintain low debt, reducing financial risk. Operational reliability remains crucial for sustaining growth and investor confidence.
Which Stock to Choose?
The Trade Desk, Inc. (TTD) shows strong income growth with a 25.63% revenue increase in 2024 and favorable profitability ratios, including a 16.08% net margin. Its financial ratios are mostly favorable, supported by low debt and a strong current ratio. However, its high valuation multiples and declining ROIC compared to WACC suggest the company is not yet creating value, though it maintains a very favorable rating.
DocuSign, Inc. (DOCU) displays steady income growth with a 7.78% revenue rise in 2025 and a notably high 35.87% net margin. Financial ratios indicate a slightly favorable position with strong profitability and low debt, despite a weaker liquidity ratio. Its ROIC is growing but still below WACC, implying improving but not yet sustainable value creation, while it holds a very favorable rating overall.
Investors focused on growth may find The Trade Desk appealing due to its robust income growth and strong profitability metrics despite valuation concerns. Conversely, those prioritizing improving profitability and financial stability might see DocuSign as slightly more favorable given its rising ROIC trend and solid margins, though liquidity risks remain a consideration.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of The Trade Desk, Inc. and DocuSign, Inc. to enhance your investment decisions:
