In the latest trading session, Reddit Inc. (RDDT - Free Report) closed at $153.34, marking a -1.48% move from the previous day. The stock's performance was behind the S&P 500's daily gain of 0.58%. Meanwhile, the Dow experienced a rise of 0.69%, and the technology-dominated Nasdaq saw an increase of 1.05%.
The company's shares have seen a decrease of 0.01% over the last month, surpassing the Computer and Technology sector's loss of 2.67% and falling behind the S&P 500's gain of 0.97%.
Market participants will be closely following the financial results of Reddit Inc. in its upcoming release. The company plans to announce its earnings on October 29, 2026. The company's earnings per share (EPS) are projected to be $1.3, reflecting a 62.5% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $886.35 million, showing a 51.54% escalation compared to the year-ago quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $5.27 per share and revenue of $3.4 billion, indicating changes of +101.15% and +54.16%, respectively, compared to the previous year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Reddit Inc. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Reddit Inc. is currently a Zacks Rank #3 (Hold).
In terms of valuation, Reddit Inc. is currently trading at a Forward P/E ratio of 29.52. Its industry sports an average Forward P/E of 20.7, so one might conclude that Reddit Inc. is trading at a premium comparatively.
Investors should also note that RDDT has a PEG ratio of 0.72 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Software stocks are, on average, holding a PEG ratio of 1.26 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 75, which puts it in the top 31% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?
Let's take a look at what these Wall Street heavyweights have to say about Reddit Inc. (RDDT - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Reddit Inc. currently has an average brokerage recommendation (ABR) of 1.84, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 32 brokerage firms. An ABR of 1.84 approximates between Strong Buy and Buy.
Of the 32 recommendations that derive the current ABR, 19 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 59.4% and 3.1% of all recommendations.
Brokerage Recommendation Trends for RDDT
Check price target & stock forecast for Reddit Inc. here>>>
While the ABR calls for buying Reddit Inc., it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.
The ABR is calculated solely based on brokerage recommendations and is typically displayed with decimals (example: 1.28). In contrast, the Zacks Rank is a quantitative model allowing investors to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
Analysts employed by brokerage firms have been and continue to be overly optimistic with their recommendations. Since the ratings issued by these analysts are more favorable than their research would support because of the vested interest of their employers, they mislead investors far more often than they guide.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is RDDT a Good Investment?Looking at the earnings estimate revisions for Reddit Inc., the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $5.27.
Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Reddit Inc. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for Reddit Inc.
SteelPeak Wealth LLC purchased a new position in shares of Reddit Inc. (NYSE:RDDT – Free Report) in the third quarter, according to its most recent disclosure with the Securities and Exchange Commission. The fund purchased 13,201 shares of the company’s stock, valued at approximately $1,880,000.
Other institutional investors also recently bought and sold shares of the company. Wellington Management Group LLP grew its position in shares of Reddit by 21.8% in the 2nd quarter. Wellington Management Group LLP now owns 1,564,535 shares of the company’s stock valued at $271,572,000 after buying an additional 280,030 shares during the last quarter. Moore Capital Management LP raised its stake in Reddit by 611.4% during the 2nd quarter. Moore Capital Management LP now owns 12,577 shares of the company’s stock worth $2,183,000 after acquiring an additional 10,809 shares in the last quarter. State Street Corp lifted its position in Reddit by 8.7% in the second quarter. State Street Corp now owns 2,979,587 shares of the company’s stock valued at $517,197,000 after acquiring an additional 237,523 shares during the last quarter. Light Street Capital Management LLC purchased a new stake in Reddit in the second quarter valued at $31,678,000. Finally, PensionDanmark Pensionsforsikringsaktieselskab boosted its stake in Reddit by 102.3% in the second quarter. PensionDanmark Pensionsforsikringsaktieselskab now owns 19,120 shares of the company’s stock valued at $3,319,000 after acquiring an additional 9,670 shares in the last quarter.
Reddit News Summary Here are the key news stories impacting Reddit this week:
Positive Sentiment: CNBC’s Jim Cramer recommended buying Reddit, describing the shares as “inexpensive.” The endorsement could improve retail-investor sentiment and draw attention to Reddit’s valuation. Jim Cramer recommends Reddit Neutral Sentiment: Reddit will report third-quarter results on Thursday, October 29. Investors are likely to focus on advertising growth, user trends and management’s outlook following the company’s previous quarterly revenue increase of 61% year over year. Reddit third-quarter earnings announcement Neutral Sentiment: Goldman Sachs maintained its Hold rating on RDDT, indicating that the firm does not see a sufficiently compelling risk-reward profile at current levels. Goldman Sachs maintains Hold rating Negative Sentiment: CEO Steve Huffman sold 17,308 shares for approximately $2.74 million, reducing his direct holdings by 4.89%. COO Jennifer Wong separately sold 60,000 shares for about $9.03 million, reducing her position by 5.60%. Both transactions were made under pre-arranged Rule 10b5-1 plans, which lessens—but does not eliminate—the negative signaling effect of insider selling. Reddit insider sales Insider Activity In other news, Director Robert Sauerberg sold 5,128 shares of the stock in a transaction dated Tuesday, August 25th. The shares were sold at an average price of $159.92, for a total transaction of $820,069.76. Following the completion of the sale, the director owned 27,087 shares in the company, valued at approximately $4,331,753.04. This represents a 15.92% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Also, COO Jennifer Wong sold 60,000 shares of the stock in a transaction dated Wednesday, October 14th. The stock was sold at an average price of $150.55, for a total transaction of $9,033,000.00. Following the sale, the chief operating officer owned 1,012,226 shares of the company’s stock, valued at $152,390,624.30. This trade represents a 5.60% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last three months, insiders sold 306,052 shares of company stock valued at $49,754,523. Insiders own 28.48% of the company’s stock. Analyst Upgrades and Downgrades RDDT has been the topic of several research reports. BNP Paribas Exane initiated coverage on Reddit in a report on Friday, September 18th. They set a “neutral” rating and a $180.00 price objective on the stock. Wells Fargo & Company cut their target price on Reddit from $187.00 to $142.00 and set an “equal weight” rating on the stock in a research report on Friday, July 31st. Guggenheim reissued a “buy” rating on shares of Reddit in a report on Wednesday, September 16th. Zacks Research cut Reddit from a “strong-buy” rating to a “hold” rating in a research report on Tuesday, August 25th. Finally, UBS Group reissued a “buy” rating on shares of Reddit in a research report on Friday, July 31st. Two research analysts have rated the stock with a Strong Buy rating, seventeen have issued a Buy rating and ten have issued a Hold rating to the stock. According to data from MarketBeat, the stock has an average rating of “Moderate Buy” and an average price target of $219.29.
Read Our Latest Analysis on Reddit
Reddit Price Performance Shares of NYSE:RDDT opened at $155.97 on Monday. The stock has a market cap of $30.01 billion, a P/E ratio of 36.27, a P/E/G ratio of 0.72 and a beta of 2.05. The firm has a fifty day moving average price of $154.22 and a 200 day moving average price of $161.65. Reddit Inc. has a 1-year low of $119.27 and a 1-year high of $263.50.
Reddit (NYSE:RDDT – Get Free Report) last issued its quarterly earnings data on Thursday, July 30th. The company reported $1.25 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.95 by $0.30. The company had revenue of $804.91 million for the quarter, compared to the consensus estimate of $731.00 million. Reddit had a net margin of 31.35% and a return on equity of 29.02%. Reddit’s revenue for the quarter was up 61.0% on a year-over-year basis. During the same period last year, the firm posted $0.45 EPS. Sell-side analysts expect that Reddit Inc. will post 5.27 EPS for the current fiscal year.
About Reddit (Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and activities. Members can submit text posts, links, images and videos, as well as comment on and vote on content. The platform includes thousands of communities, commonly known as subreddits, covering subjects such as news, entertainment, technology, sports, finance and lifestyle.
Reddit generates revenue primarily through digital advertising, offering advertisers access to audiences based on community interests and user engagement.
Featured Stories Five stocks we like better than Reddit These 3 Green Stocks Have a Growth Story That Goes Far Beyond Washington Meta Claims Frontier-Class AI Status With New Muse Wonder Models Berkshire Just Backed This Little-Known Stock—Should You Chase It? Broadcom’s CEO Sees Years of AI Demand But Warns of a Bigger Threat to the Boom Want to see what other hedge funds are holding RDDT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Reddit Inc. (NYSE:RDDT – Free Report).
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Reddit remains a 'strong buy,' as I see a major growth story unfolding. RDDT's opportunity lies in capitalizing on advertisers' willingness to increase spending on effective channels. My thesis pivots to Reddit's potential to convert infrequent visitors into daily users, driving engagement and monetization, and explores a different angle.
Reddit Inc. (NYSE:RDDT – Get Free Report) CEO Steve Huffman sold 17,308 shares of the firm’s stock in a transaction on Tuesday, October 13th. The shares were sold at an average price of $158.57, for a total value of $2,744,529.56. Following the completion of the sale, the chief executive officer owned 336,432 shares in the company, valued at $53,348,022.24. The trade was a 4.89% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.
Steve Ladd Huffman also recently made the following trade(s):
On Tuesday, September 29th, Steve Huffman sold 17,308 shares of Reddit stock. The shares were sold at an average price of $144.87, for a total transaction of $2,507,409.96. On Tuesday, September 15th, Steve Huffman sold 17,308 shares of Reddit stock. The shares were sold at an average price of $160.11, for a total transaction of $2,771,183.88. On Monday, August 31st, Steve Huffman sold 18,000 shares of Reddit stock. The shares were sold at an average price of $148.02, for a total transaction of $2,664,360.00. On Friday, August 14th, Steve Huffman sold 18,000 shares of Reddit stock. The shares were sold at an average price of $178.16, for a total transaction of $3,206,880.00. On Tuesday, August 4th, Steve Huffman sold 18,000 shares of Reddit stock. The shares were sold at an average price of $159.78, for a total transaction of $2,876,040.00. Reddit Trading Down 2.1% NYSE RDDT opened at $155.97 on Friday. Reddit Inc. has a 52 week low of $119.27 and a 52 week high of $263.50. The stock has a market cap of $30.01 billion, a price-to-earnings ratio of 36.27, a price-to-earnings-growth ratio of 0.72 and a beta of 2.05. The company has a 50-day moving average price of $154.22 and a two-hundred day moving average price of $161.39.
Reddit (NYSE:RDDT – Get Free Report) last announced its quarterly earnings results on Thursday, July 30th. The company reported $1.25 EPS for the quarter, beating the consensus estimate of $0.95 by $0.30. The company had revenue of $804.91 million for the quarter, compared to analyst estimates of $731.00 million. Reddit had a net margin of 31.35% and a return on equity of 29.02%. Reddit’s revenue was up 61.0% compared to the same quarter last year. During the same quarter last year, the business earned $0.45 earnings per share. As a group, equities research analysts expect that Reddit Inc. will post 5.27 earnings per share for the current fiscal year. Hedge Funds Weigh In On Reddit Several large investors have recently bought and sold shares of the stock. State Street Corp raised its position in shares of Reddit by 8.7% during the 2nd quarter. State Street Corp now owns 2,979,587 shares of the company’s stock worth $517,197,000 after buying an additional 237,523 shares in the last quarter. Wellington Management Group LLP lifted its stake in shares of Reddit by 21.8% in the 2nd quarter. Wellington Management Group LLP now owns 1,564,535 shares of the company’s stock worth $271,572,000 after acquiring an additional 280,030 shares during the period. DSM Capital Partners LLC boosted its holdings in shares of Reddit by 5.3% in the first quarter. DSM Capital Partners LLC now owns 848,206 shares of the company’s stock valued at $114,211,000 after acquiring an additional 42,808 shares in the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its holdings in shares of Reddit by 8.9% in the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 481,893 shares of the company’s stock valued at $83,647,000 after acquiring an additional 39,540 shares in the last quarter. Finally, Bessemer Group Inc. boosted its holdings in shares of Reddit by 2.4% in the first quarter. Bessemer Group Inc. now owns 469,907 shares of the company’s stock valued at $63,273,000 after acquiring an additional 10,996 shares in the last quarter.
More Reddit News Here are the key news stories impacting Reddit this week:
Positive Sentiment: CNBC’s Jim Cramer recommended buying Reddit, describing the shares as “inexpensive.” The endorsement could improve retail-investor sentiment and draw attention to Reddit’s valuation. Jim Cramer recommends Reddit Neutral Sentiment: Reddit will report third-quarter results on Thursday, October 29. Investors are likely to focus on advertising growth, user trends and management’s outlook following the company’s previous quarterly revenue increase of 61% year over year. Reddit third-quarter earnings announcement Neutral Sentiment: Goldman Sachs maintained its Hold rating on RDDT, indicating that the firm does not see a sufficiently compelling risk-reward profile at current levels. Goldman Sachs maintains Hold rating Negative Sentiment: CEO Steve Huffman sold 17,308 shares for approximately $2.74 million, reducing his direct holdings by 4.89%. COO Jennifer Wong separately sold 60,000 shares for about $9.03 million, reducing her position by 5.60%. Both transactions were made under pre-arranged Rule 10b5-1 plans, which lessens—but does not eliminate—the negative signaling effect of insider selling. Reddit insider sales Analyst Ratings Changes A number of equities analysts recently issued reports on RDDT shares. Roth Capital reissued a “neutral” rating and issued a $145.00 price objective on shares of Reddit in a report on Monday, August 3rd. Wells Fargo & Company lowered their target price on Reddit from $187.00 to $142.00 and set an “equal weight” rating on the stock in a research report on Friday, July 31st. Guggenheim reaffirmed a “buy” rating on shares of Reddit in a research note on Wednesday, September 16th. Sanford C. Bernstein reiterated a “market perform” rating and set a $180.00 price target on shares of Reddit in a research report on Friday, July 31st. Finally, Wedbush reduced their price target on Reddit from $250.00 to $221.00 and set an “outperform” rating for the company in a research report on Friday, July 31st. Two equities research analysts have rated the stock with a Strong Buy rating, seventeen have given a Buy rating and ten have given a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $219.29.
Check Out Our Latest Report on Reddit
Reddit Company Profile (Get Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and experiences. Registered users can submit posts, images, videos and links, while other users can comment, vote on content and engage in discussions. The platform comprises thousands of independently moderated communities, commonly known as subreddits.
Reddit generates revenue primarily through digital advertising and other commercial offerings for businesses.
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Reddit Inc. (NYSE:RDDT – Get Free Report) COO Jennifer Wong sold 60,000 shares of Reddit stock in a transaction dated Wednesday, October 14th. The shares were sold at an average price of $150.55, for a total transaction of $9,033,000.00. Following the completion of the sale, the chief operating officer directly owned 1,012,226 shares in the company, valued at approximately $152,390,624.30. The trade was a 5.60% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.
Reddit Stock Down 2.1% Shares of Reddit stock opened at $155.97 on Friday. Reddit Inc. has a 52-week low of $119.27 and a 52-week high of $263.50. The company’s 50-day simple moving average is $154.22 and its 200-day simple moving average is $161.39. The firm has a market cap of $30.01 billion, a price-to-earnings ratio of 36.27, a price-to-earnings-growth ratio of 0.72 and a beta of 2.05.
Reddit (NYSE:RDDT – Get Free Report) last posted its quarterly earnings results on Thursday, July 30th. The company reported $1.25 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.95 by $0.30. The firm had revenue of $804.91 million during the quarter, compared to analysts’ expectations of $731.00 million. Reddit had a net margin of 31.35% and a return on equity of 29.02%. The firm’s revenue for the quarter was up 61.0% on a year-over-year basis. During the same period in the prior year, the company posted $0.45 earnings per share. Equities research analysts anticipate that Reddit Inc. will post 5.27 EPS for the current year.
Hedge Funds Weigh In On Reddit Large investors have recently made changes to their positions in the stock. Sunbelt Securities Inc. boosted its holdings in Reddit by 87.5% during the first quarter. Sunbelt Securities Inc. now owns 195 shares of the company’s stock worth $26,000 after buying an additional 91 shares in the last quarter. Ascentis Independent Advisors acquired a new position in Reddit during the first quarter worth about $30,000. EverSource Wealth Advisors LLC grew its position in Reddit by 48.1% during the second quarter. EverSource Wealth Advisors LLC now owns 197 shares of the company’s stock worth $34,000 after buying an additional 64 shares during the period. Beacon Investment Advisory Services Inc. acquired a new position in Reddit during the second quarter worth about $35,000. Finally, V Square Quantitative Management LLC purchased a new position in Reddit in the first quarter valued at about $43,000. Reddit News Summary Here are the key news stories impacting Reddit this week:
Positive Sentiment: CNBC’s Jim Cramer recommended buying Reddit, describing the shares as “inexpensive.” The endorsement could improve retail-investor sentiment and draw attention to Reddit’s valuation. Jim Cramer recommends Reddit Neutral Sentiment: Reddit will report third-quarter results on Thursday, October 29. Investors are likely to focus on advertising growth, user trends and management’s outlook following the company’s previous quarterly revenue increase of 61% year over year. Reddit third-quarter earnings announcement Neutral Sentiment: Goldman Sachs maintained its Hold rating on RDDT, indicating that the firm does not see a sufficiently compelling risk-reward profile at current levels. Goldman Sachs maintains Hold rating Negative Sentiment: CEO Steve Huffman sold 17,308 shares for approximately $2.74 million, reducing his direct holdings by 4.89%. COO Jennifer Wong separately sold 60,000 shares for about $9.03 million, reducing her position by 5.60%. Both transactions were made under pre-arranged Rule 10b5-1 plans, which lessens—but does not eliminate—the negative signaling effect of insider selling. Reddit insider sales Analyst Ratings Changes A number of equities analysts have recently issued reports on RDDT shares. UBS Group reissued a “buy” rating on shares of Reddit in a research note on Friday, July 31st. Evercore reissued an “outperform” rating and issued a $265.00 price target on shares of Reddit in a report on Friday, July 31st. Citigroup restated a “market outperform” rating on shares of Reddit in a research note on Wednesday. Wedbush decreased their price target on Reddit from $250.00 to $221.00 and set an “outperform” rating on the stock in a research note on Friday, July 31st. Finally, Deutsche Bank Aktiengesellschaft set a $200.00 price objective on Reddit in a report on Friday, July 31st. Two investment analysts have rated the stock with a Strong Buy rating, seventeen have given a Buy rating and ten have assigned a Hold rating to the company. According to MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus target price of $219.29.
Check Out Our Latest Analysis on RDDT
About Reddit (Get Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and experiences. Registered users can submit posts, images, videos and links, while other users can comment, vote on content and engage in discussions. The platform comprises thousands of independently moderated communities, commonly known as subreddits.
Reddit generates revenue primarily through digital advertising and other commercial offerings for businesses.
Featured Articles Five stocks we like better than Reddit Rocket Lab’s Neutron Delay Leaves Wall Street Bullish But Raises the Stakes for 2027 ManpowerGroup Stock Sinks on Q3 Results, But Fundamentals Stay Solid Does the AI Selloff Put Alphabet’s Breakout in Doubt? Bank Earnings Are Mixed—These 2 ETFs Offer Very Different Paths to a Recovery
Receive News & Ratings for Reddit Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Reddit and related companies with MarketBeat.com's FREE daily email newsletter.
Focus Financial Network Inc. trimmed its stake in shares of Reddit Inc. (NYSE: RDDT) by 41.2% in the undefined quarter, according to its most recent disclosure with the Securities and Exchange Commission. The fund owned 5,031 shares of the company's stock after selling 3,531 shares during the period. Focus Financial Network Inc.'s holdings
In the latest trading session, Reddit Inc. (RDDT - Free Report) closed at $156.14, marking a -2.02% move from the previous day. The stock fell short of the S&P 500, which registered a loss of 1.09% for the day. Meanwhile, the Dow lost 0.34%, and the Nasdaq, a tech-heavy index, lost 2.15%.
The company's shares have seen an increase of 4.27% over the last month, surpassing the Computer and Technology sector's gain of 1.99% and the S&P 500's gain of 2.44%.
Investors will be eagerly watching for the performance of Reddit Inc. in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on October 29, 2026. It is anticipated that the company will report an EPS of $1.3, marking a 62.5% rise compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $886.35 million, up 51.54% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $5.27 per share and revenue of $3.4 billion, which would represent changes of +101.15% and +54.16%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Reddit Inc. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Reddit Inc. is currently sporting a Zacks Rank of #2 (Buy).
With respect to valuation, Reddit Inc. is currently being traded at a Forward P/E ratio of 30.23. This valuation marks a premium compared to its industry average Forward P/E of 21.23.
Meanwhile, RDDT's PEG ratio is currently 0.74. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 1.25.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 81, which puts it in the top 33% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
On CNBC’s “Mad Money Lightning Round,” Jim Cramer recommended buying Reddit, Inc. (NYSE:RDDT), calling the stock “inexpensive.”
Reddit said it will release third-quarter financial results after the closing bell on Thursday, Oct. 29.
Cramer said that although ExxonMobil Holdings Corporation (NYSE:XOM) is good, but Chevron Corporation (NYSE:CVX) is better.
Morgan Stanley analyst Devin McDermott maintained an Overweight rating on ExxonMobil on Thursday and raised the price target from $177 to $185.
When asked about Enterprise Products Partners L.P. (NYSE:EPD), he said, “They do natural gas liquids. They are the other part of the equation, not oil. You’re fine on that one. As a matter of fact, I think you have to take advantage of it because it’s getting hit as if it is going to get hurt, but it’s not.”
JP Morgan analyst Jeremy Tonet, on Oct. 8, maintained the stock with a Neutral and cut the price target from $43 to $42.
SiTime Corporation (NASDAQ:SITM) is “expensive,” Cramer said. “I’m not recommending expensive stocks in tech or out of tech.”
On earnings, SiTime will announce its third-quarter results on Wednesday, Nov. 4, after the closing bell.
Cramer said Coherent Corp. (NYSE:COHR) and Lumentum Holdings Inc. (NASDAQ:LITE) are good, but Corning Incorporated (NYSE:GLW) is best.
B. Riley Securities analyst Dave Kang, on Thursday, maintained Coherent with a Neutral and lowered the price target from $345 to $297.
Valero Energy Corporation (NYSE:VLO) is the “riskiest trade in the world. This thing is a double or nothing trade from here,” Cramer said.
Wells Fargo analyst Sam Margolin maintained an Overweight rating on Valero Energy on Wednesday and raised the price target from $389 to $485.
Price ActionReddit shares gained 7.2% to settle at $159.36 on Thursday.Exxon shares fell 1.2% to close at $174.68.Enterprise Products Partners fell 0.6% to settle at $35.57 on Thursday.SiTime shares dipped 4.5% to close at $501.59.Coherent shares fell 4.8% to settle at $250.60.Valero shares fell 3.4% to close at $444.06 on Thursday.Photo via Shutterstock
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SAN FRANCISCO--(BUSINESS WIRE)--Reddit, Inc. (NYSE: RDDT), announced today that the company's third quarter 2026 financial results will be released after market close on Thursday, October 29, 2026. Reddit will host a conference call to discuss its results at 1:30 p.m. PT / 4:30 p.m. ET the same day. The live webcast of the conference call and related earnings materials can be accessed at Reddit's Investor Relations website at investor.redditinc.com and investor relations subreddit r/RDDT. A rep.
She retired, paid off her mortgage, and closed two credit cards, and every single decision hit her credit score like a separate penalty. The scoring system treated thirty years of perfect payments as almost irrelevant.
A 68-year-old woman does three responsible things in one year. She retires in March, pays off the last $38,000 of her mortgage in June, and then closes two of her three credit cards to simplify things. By the end of the year, her credit score has dropped from about 805 to 735.
She owes nothing and has never missed a payment, but scoring models still reward active, well-managed credit, and she just removed most of hers. This happens more than people might expect. One Reddit (NYSE:RDDT | RDDT Price Prediction) thread titled “Paid off my house, and my credit score plummeted” filled up. People kept telling the same story. Equifax (NYSE:EFX) warns that closing a paid-off card “lowers your total available credit.”
Three Good Decisions, Three Separate Score Hits
The reality is that this individual’s credit mix took the first hit. The mortgage was her only installment account, meaning a loan with fixed monthly payments, and once it closed, her file showed only revolving credit like credit cards. Money.com notes that paying off a mortgage or auto loan can lower your score because “it reduces your credit mix.”
Utilization did the most damage. Utilization is the share of your available credit you’re using. Closing two cards cut her total limit from $42,000 to $9,000. She still charges about $2,000 a month, and that same spending rose from 5% of her available credit to 22%. Paying in full each month doesn’t help here, because issuers usually report the statement balance before her payment posts.
Account age will take a smaller hit. One of the cards she closed was opened in 1994, and closed accounts in good standing stay on her report for a while, so the damage shows up later. When that card finally drops off her report, her average account age shrinks.
Why Losing 70 Points Matters at 68
Retirees borrow less, but they still borrow, and getting approved gets harder without a paycheck. She’ll probably want a home equity line of credit (HELOC) at 71. Without a salary, lenders will use asset-depletion rules, which treat part of her savings as paper income. Showing income becomes the hard part of that application, while a strong score was the easy part, and she gave some of it away.
Other needs follow. She may sign an apartment lease if she downsizes, and she may finance a car. In most states, credit-based insurance scores also help set auto and home premiums. A lighter credit file can raise those bills every year, even if she never borrows a dollar.
High rates raise the stakes. The 10-year Treasury yield, a benchmark for mortgage and home equity pricing, now trades at 5%, up from 4% a year ago. When base rates are this high, the gap between pricing levels costs real money.
What a 735 Really Costs Her
A 735 still qualifies for almost everything. She can get approved for a HELOC or a car loan. What she gives up is pricing. Many lenders save their best rates for scores of 760 and up, so she’s dropped from the top tier to the one below. Any future loan will carry a higher rate, and insurance premiums may rise too. It’s a manageable bother she could have avoided.
Get the Order Right in Your Retirement Year
She could have prevented most of this by doing things in a different order:
Ask for credit limit increases before your last day of work. Issuers ask about income, and a salary supports a bigger limit than retirement income will. Higher limits keep your utilization low.
Keep every card open. Put a small recurring charge on each one. Use something like a $15 subscription, and set it to autopay in full so the issuer doesn’t close the card for inactivity. With card rates averaging 21%, never let those small charges turn into a carried balance.
Never close your oldest account. A card from the 1990s supports your credit history. If it charges an annual fee, ask the issuer to switch it to a no-fee version instead of closing it.
If the math supports it, pay off the mortgage and expect the score to dip. Getting rid of a monthly payment before you live on a fixed income often makes sense. Base that decision on your cash flow and expected returns, and leave a few months between the payoff and any new loan application.
Your First Move If You Retire This Year
Before you close anything, add up your current card limits and figure out what share of that total your normal monthly spending uses. Then run the same math with any card you plan to close taken out. If the share rises sharply, keep the card.
A frequent mistake is assuming simplifying means closing accounts. You can simplify your wallet by putting extra cards in a drawer and setting a small autopay on each. Your credit report keeps the limits and the long history, and your score stays close to where you left it.
Contact [email protected] for any questions or corrections.
Reddit Inc. (RDDT - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Over the past month, shares of this company have returned -5.7%, compared to the Zacks S&P 500 composite's +2.1% change. During this period, the Zacks Internet - Software industry, which Reddit Inc. falls in, has gained 4.5%. The key question now is: What could be the stock's future direction?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Reddit Inc. is expected to post earnings of $1.30 per share, indicating a change of +62.5% from the year-ago quarter. The Zacks Consensus Estimate has changed -1.2% over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $5.27 points to a change of +101.2% from the prior year. Over the last 30 days, this estimate has remained unchanged.
For the next fiscal year, the consensus earnings estimate of $6.94 indicates a change of +31.6% from what Reddit Inc. is expected to report a year ago. Over the past month, the estimate has remained unchanged.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Reddit Inc..
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Reddit Inc., the consensus sales estimate for the current quarter of $886.35 million indicates a year-over-year change of +51.5%. For the current and next fiscal years, $3.4 billion and $4.51 billion estimates indicate +54.2% and +32.8% changes, respectively.
Last Reported Results and Surprise HistoryReddit Inc. reported revenues of $804.91 million in the last reported quarter, representing a year-over-year change of +61.1%. EPS of $1.25 for the same period compares with $0.45 a year ago.
Compared to the Zacks Consensus Estimate of $743.93 million, the reported revenues represent a surprise of +8.2%. The EPS surprise was +26.26%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Reddit Inc. is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Reddit Inc.. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Digital advertising is evolving rapidly as automation and community engagement take center stage. Choosing between AppLovin (APP +0.33%) and Reddit (RDDT -0.71%)requires examining how each captures value in this shifting landscape.
AppLovin provides the technical backbone for mobile app monetization, while Reddit operates a vast network of interest-based communities. Both companies have achieved profitability and exhibit rapid revenue growth, making them key candidates for investors evaluating high-growth platforms in the digital advertising space. Their distinct business models offer different ways to play the internet software market.
The case for AppLovinAppLovin sells marketing software and advertising solutions to mobile app developers and consumer brands. Its platform includes tools like Axon Ads Manager for user acquisition, MAX for in-app bidding, and Adjust for analytics. In its latest annual report, filed for the period ending Dec. 31, 2024, the company stated it had 1,563 employees across 17 countries and highlighted its focus on advertising technology among tech stocks that support the global mobile economy. By divesting its apps business, the company now concentrates entirely on its software platform.
In FY 2025, revenue reached nearly $5.5 billion, representing a significant 70% increase over the $3.2 billion reported in the previous year. The company reported net income of roughly $3.3 billion during this period, which is more than double its FY 2024 performance. This expansion yielded an impressive net margin of approximately 60.8%, demonstrating its ability to translate higher sales into earnings while maintaining low operating costs relative to its scale.
The company maintains a current ratio of about 3.3x, which indicates its ability to cover short-term liabilities with assets such as cash. As of its December 2025 balance sheet, its debt-to-equity ratio was roughly 1.7x, a measure of total debt relative to shareholders' equity. Free cash flow for the year reached close to $3.9 billion, representing cash from operations after subtracting capital expenditures. This strong cash generation provides the company with significant flexibility for future investments or debt reduction.
The case for RedditReddit operates a community platform where users discuss interests across thousands of distinct forums, providing a unique environment for advertisers. It generates revenue primarily from third-party advertising, which accounted for approximately 94% of its revenue in FY 2025. While revenue is significantly concentrated among a small number of top advertisers, the company is now exploring additional streams, such as content licensing for artificial intelligence training and developer programs. This strategy aims to monetize the vast amount of user-generated content hosted on the site.
In FY 2025, revenue reached approximately $2.2 billion, a 69.4% increase from $1.3 billion in FY 2024. Reddit transitioned to profitability during this period, reporting net income of close to $529.7 million after a substantial loss in the prior year. This resulted in a net margin of roughly 24.1%, marking a major milestone in the company's financial history and reflecting its shift toward sustainable operations.
As of its December 2025 balance sheet, Reddit reported a debt-to-equity ratio of 0.0x, indicating it carries no traditional debt relative to its equity. Its current ratio is a very high 11.6x, suggesting substantial liquidity to cover short-term obligations with current assets. Free cash flow for the year was nearly $684.2 million, which is cash from operations minus capital expenditures. Note that stock-based compensation accounted for roughly 49.7% of operating cash flow, inflating reported cash generation, since SBC is a non-cash expense added back to cash flow.
Risk profile comparisonAppLovin faces material risks from litigation, including class action lawsuits regarding its artificial intelligence models and a consumer protection lawsuit concerning data targeting. The company is highly dependent on major platforms like Apple (AAPL +0.98%), Alphabet, and Meta Platforms, which have the power to change privacy settings that affect ad effectiveness. Strategic risks also remain regarding its ability to manage rapid growth, successfully integrate past acquisitions, and identify new market opportunities.
Reddit relies heavily on maintaining user engagement, as a decline in daily active users could cause advertisers to cut their budgets. The company also depends on cloud providers such as Amazon (AMZN +0.31%) and Alphabet for its infrastructure. Furthermore, its reliance on volunteer moderators can lead to community instability or reputational damage. Finally, Reddit faces ongoing legal exposure from global data privacy and artificial intelligence regulations, as well as class action litigation over securities fraud.
Valuation comparisonAppLovin appears more attractive on a price-to-earnings basis, while Reddit offers a slightly lower price-to-sales multiple. The Forward P/E compares a stock price to future earnings estimates, while the P/S ratio measures market value relative to sales over the past twelve months.
MetricAppLovinRedditForward P/E17.6x29.7xP/S ratio13.6x11.1xValuation metrics include those sourced from Financial Modeling Prep (FMP) and may differ from those of other data providers.
When comparing AppLovin and Reddit, investors should consider a few key factors. Let's have a look at them and see what that tells us about each stock.
To start, there's growth. Both companies are growing incredibly fast. Since 2022, Applovin has averaged 27% year-over-year revenue growth. Not to be outdone, Reddit has averaged 53%, a simply astounding rate. What's more, both companies continue to produce exceptional growth up to the present. In Reddit's most recent quarter, revenue growth clocked in at 61%, Applovin's was 53%. While both companies have delivered fantastic growth, Reddit gains a slight edge in the category.
Another factor to consider is each company's profitability. Applovin has delivered consistent, albeit modest, profits for years. Reddit, on the other hand, has only pivoted to consistent profitability in the last year or so. Consequently, Applovin has an advantage here. Applovin's five-year average operating margin is 34%. In recent quarters, that figure has increased to over 75%, demonstrating exceptional overall operating leverage. Reddit, by contrast, has averaged an operating margin of -18% over the last five years. However, in recent quarters, its operating margin has improved markedly to 28%.
Last, we must examine each company's balance sheet. Debt levels can act as an anchor for young companies seeking to grow fast. However, both Applovin and Reddit have solid balance sheets. Reddit has no net debt and over $2.7 billion in net cash, giving it plenty of flexibility for acquisitions, share buybacks, and capital investments. Applovin does have $462 million in net debt; however, that figure is down significantly from a high of over $3.0 billion in 2025. Nonetheless, Reddit wins the head-to-head matchup in this category.
In summary, both stocks are solid choices for growth-oriented investors. Applovin can claim better profitability, while Reddit has the edge in both growth and balance sheet strength. If forced to choose between the two, Reddit comes out ahead for me, although Applovin is also a solid choice for growth-seeking investors willing to buy and hold.
Reddit Inc (NYSE:RDDT), the social media platform, is winning a larger share of digital advertising budgets, with Horizon Media reporting that its share of client spending has grown 20% to 25% annually over the past three years.
Jefferies reached that view after hosting calls with advertising experts from Horizon Media and Jan Kelley Ad Agency to discuss demand trends, macroeconomic effects and competitive positioning.
Horizon Media expects digital ad spending across its clients to grow about 10% in financial year 2026 and 2027, with no sign of macroeconomic weakness linked to geopolitical tensions or fuel price inflation.
Jan Kelley Ad Agency, the other participant, saw spending accelerate in the second half as advertisers released budgets held back in the first half because of macroeconomic uncertainty.
Reddit has been among Horizon’s fastest growing digital channels for three years, with its share of the agency’s client budgets rising 20% to 25% annually.
Google and Meta account for 80% to 90% of Jan Kelley’s advertising spending, with Reddit commanding 60% to 70% of the remainder, ahead of LinkedIn, Pinterest and Snap.
Horizon says Reddit’s Dynamic Product shopping ads and Max automation tools extend its strength in upper-funnel advertising to performance-focused campaigns, which the bank says carry higher CPMs.
Early tests of Reddit Max have reduced cost per acquisition by 15% to 20% for Jan Kelley’s clients, although the tool remains at an early stage.
Reddit’s ad pricing is no longer a material discount to peers, with Jan Kelley attributing the change to improved outcomes and a greater focus on lower-funnel advertising.
Advertisers also value Reddit’s favorable visibility in artificial intelligence (AI) search results, as its content is cited in responses from large language models, the systems behind chatbots such as ChatGPT.
Advertising within large language models remains largely at the test-and-learn stage, with Horizon citing ChatGPT’s smaller audience than Google as a constraint on adoption and Jan Kelley reporting weak lower-funnel results and limited visibility into return on ad spend.
Jefferies hosted both calls to discuss digital advertising demand, macroeconomic effects and competitive positioning, with replays available to clients.
In the latest trading session, Reddit Inc. (RDDT - Free Report) closed at $156.47, marking a +2.46% move from the previous day. This change outpaced the S&P 500's 0.47% loss on the day. On the other hand, the Dow registered a gain of 0.1%, and the technology-centric Nasdaq decreased by 1.25%.
Shares of the company have appreciated by 4.28% over the course of the past month, underperforming the Computer and Technology sector's gain of 6.08%, and outperforming the S&P 500's gain of 1.15%.
Investors will be eagerly watching for the performance of Reddit Inc. in its upcoming earnings disclosure. The company is predicted to post an EPS of $1.3, indicating a 62.5% growth compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $886.35 million, indicating a 51.54% growth compared to the corresponding quarter of the prior year.
RDDT's full-year Zacks Consensus Estimates are calling for earnings of $5.27 per share and revenue of $3.4 billion. These results would represent year-over-year changes of +101.15% and +54.16%, respectively.
It is also important to note the recent changes to analyst estimates for Reddit Inc. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. As of now, Reddit Inc. holds a Zacks Rank of #2 (Buy).
In the context of valuation, Reddit Inc. is at present trading with a Forward P/E ratio of 28.96. This expresses a premium compared to the average Forward P/E of 20.39 of its industry.
Meanwhile, RDDT's PEG ratio is currently 0.71. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Software stocks are, on average, holding a PEG ratio of 1.19 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 102, this industry ranks in the top 42% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of RDDT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Reddit (NYSE:RDDT – Get Free Report) and CarGurus (NASDAQ:CARG – Get Free Report) are both communication services companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, analyst recommendations, profitability and institutional ownership.
Earnings & Valuation This table compares Reddit and CarGurus”s gross revenue, earnings per share (EPS) and valuation.
Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio Reddit $2.20 billion 13.14 $529.72 million $4.30 34.97 CarGurus $906.98 million 2.94 $155.90 million $1.84 16.28 Reddit has higher revenue and earnings than CarGurus. CarGurus is trading at a lower price-to-earnings ratio than Reddit, indicating that it is currently the more affordable of the two stocks. Analyst Ratings This is a summary of current ratings and price targets for Reddit and CarGurus, as provided by MarketBeat.
Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score Reddit 0 10 17 2 2.72 CarGurus 0 7 7 1 2.60 Reddit currently has a consensus target price of $219.29, indicating a potential upside of 45.81%. CarGurus has a consensus target price of $40.75, indicating a potential upside of 36.03%. Given Reddit’s stronger consensus rating and higher probable upside, equities analysts plainly believe Reddit is more favorable than CarGurus.
Institutional & Insider Ownership 86.9% of CarGurus shares are held by institutional investors. 28.5% of Reddit shares are held by insiders. Comparatively, 18.2% of CarGurus shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability This table compares Reddit and CarGurus’ net margins, return on equity and return on assets.
Net Margins Return on Equity Return on Assets Reddit 31.35% 29.02% 26.32% CarGurus 18.06% 62.88% 32.82% Volatility and Risk Reddit has a beta of 2.05, indicating that its share price is 105% more volatile than the S&P 500. Comparatively, CarGurus has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500.
Summary Reddit beats CarGurus on 12 of the 15 factors compared between the two stocks.
About Reddit (Get Free Report)
Reddit, Inc. operates a website that organizes digital communities. It organizes communities based on specific interests that enable users to engage in conversations by sharing experiences, submitting links, uploading images and videos, and replying to one another. The company was founded in 2005 and is headquartered in San Francisco, California.
About CarGurus (Get Free Report)
CarGurus, Inc. operates an online automotive platform for buying and selling vehicles in the United States and internationally. It operates through two segments, U.S. Marketplace and Digital Wholesale. The company provides an online automotive marketplace where customers can search for new and used car listings from its dealers and sell their car to dealers and other consumers; and paid listings subscriptions for enhanced access to its marketplace that connects dealers to a large audience of informed and engaged consumers. It also offers dealer and non-dealer advertising products for its websites and social media platforms. The company operates online marketplaces under the CarGurus brand in the United States, Canada, and the United Kingdom; Autolist and CarOffer brands in the United States; and PistonHeads brand in the United Kingdom. The company was formerly known as CarGurus LLC and changed its name to CarGurus, Inc. in June 2015. CarGurus, Inc. was founded in 2005 and is headquartered in Cambridge, Massachusetts.
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Key Takeaways Reddit shares are down 35.7% YTD as weaker search referrals and digital ad competition pressure the stock. Reddit's daily active uniques rose 18% in Q2, while weekly active uniques climbed 24% year over year. Reddit Max usage rose more than 60% from Q1, while revenues from Max campaigns increased more than 150%. Reddit (RDDT - Free Report) shares have plunged 35.7% in the year-to-date period, underperforming the broader Zacks Computer & Technology sector’s 24.7% increase. The Zacks Internet - Software industry has also increased 10% in the same time frame.
The company’s shares have also underperformed its peers, which include Pinterest (PINS - Free Report) , Meta Platforms (META - Free Report) and Snap (SNAP - Free Report) . These companies are expanding their footprint in the digital advertising market. Shares of Meta Platforms have gained 10.3%, while Pinterest and Snap have lost 25.6% and 30.9%, respectively, in the year-to-date period.
The dip can be explained by irregular and declining search referral traffic, especially toward the end of the second quarter of 2026, causing a slight decrease in the number of daily active users and increasing volatility. The lack of insight into external search trends still poses a problem. Difficult macroeconomic uncertainties and the intense competition in the digital advertising market remain concerns.
RDDT Stock Performance
Image Source: Zacks Investment Research
Despite these headwinds, Reddit’s expanding advertising portfolio, strong user engagement, including rising daily and weekly active users, gains in Average Revenue Per Unique (ARPU) and the expansion of advertiser tools such as Dynamic Product Ads, Reddit Pixel and CAPI have been key catalysts. These factors are helping Reddit to fend off its competitors like Pinterest, Snap and Meta Platforms.
RDDT Benefits From Expanding PortfolioReddit’s expanding portfolio has been a key catalyst in driving the company’s user engagement. In the second quarter of 2026, Reddit reported 130.3 million daily active uniques, up 18% year over year, and 514.6 million weekly active uniques, up 24% year over year.
RDDT is benefiting from successful product innovation and user engagement strategies. The company’s focus on improving the experience for new users, particularly through updated feed models and easier posting mechanisms, has led to a 50% year-over-year increase in new app user retention in the second quarter of 2026. Features like video in comments and interactive games have expanded engagement opportunities. At the same time, efforts to convert web users to app users have resulted in higher retention and more valuable user cohorts.
The company’s innovation in its ad stack has been a major growth driver. The launch and rapid adoption of Reddit Max, an AI-driven suite for ad automation and optimization, has delivered significant results. Advertiser usage of Max grew more than 60% from the first quarter, and revenues from Max campaigns increased by more than 150%. Features like tailored creatives and dynamic product ads are helping brands achieve better outcomes, such as Lenovo’s 40% higher purchase value with Max campaigns compared to standard campaigns.
Further expanding its portfolio, in September 2026, Reddit made its AI-powered Max campaigns available to all advertisers following a beta launch earlier this year. Max campaigns automate targeting, creative selection, placements, and budget allocation while allowing advertisers to retain strategic control. Reddit said early tests delivered 17% lower cost per acquisition and more than 27% higher conversions versus standard campaigns. The company also added Advertising API support, integration with Smartly and new asset groups, enabling advertisers to manage multiple creative sets within a single campaign and assess performance separately.
RDDT Benefits From Expanding Global FootprintReddit is benefiting from the rapid expansion of its global user and advertiser footprint, which is strengthening its competitive position.
In the second quarter of 2026, Reddit’s international revenues surged 84% year over year to $166.8 million, outpacing 56% growth in U.S. revenues. International daily active uniques (DAUq) increased 28% to 77.1 million, while international weekly active uniques (WAUq) jumped 35% to 317.4 million. The expanding international audience strengthens Reddit’s ability to attract global advertisers.
Improving monetization of this expanding overseas audience is another key catalyst. International average revenue per unique increased 31% year over year to $2.26 from $1.73. Meanwhile, global ARPU rose 36% to $6.18 from $4.53, supported by higher advertising pricing and impressions.
Earnings Estimates for Reddit Show Upward TrendRDDT’s expanding portfolio and rising user engagement are expected to drive the company’s top-line growth.
For the third quarter of 2026, management expects revenues between $860 million and $870 million, representing 47% to 49% year-over-year growth. The midpoint implies about 48% year-over-year growth. The Zacks Consensus Estimate for third-quarter revenues is pegged at $886.35 million, indicating year-over-year growth of 51.54%.
For the third quarter, the consensus mark for earnings is pegged at $1.30 per share, which has increased 2.25% over the past 30 days. This implies year-over-year growth of 62.50%.
RDDT Stock Is OvervaluedReddit stock is currently trading at a premium, as suggested by the Value Score of D.
In terms of the forward 12-month Price/Sales ratio, RDDT is trading at 6.70X, higher than the broader Zacks Computer & Technology sector’s 6.18X.
RDDT Valuation
Image Source: Zacks Investment Research
ConclusionReddit’s prospects benefit from an expanding portfolio and rising user engagement. These factors justify the company’s premium valuation.
RDDT stock currently carries a Zacks Rank #2 (Buy) and has a Growth Score of A, a favorable combination that offers a strong investment opportunity, per the Zacks proprietary methodology. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Reddit Inc. (RDDT - Free Report) closed at $147.86 in the latest trading session, marking a -1.12% move from the prior day. This change lagged the S&P 500's 0.73% gain on the day. Elsewhere, the Dow saw an upswing of 0.49%, while the tech-heavy Nasdaq appreciated by 1.19%.
The company's shares have seen a decrease of 4.14% over the last month, not keeping up with the Computer and Technology sector's gain of 6.36% and the S&P 500's gain of 0.55%.
Investors will be eagerly watching for the performance of Reddit Inc. in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.3, marking a 62.5% rise compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $886.35 million, up 51.54% from the prior-year quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.27 per share and revenue of $3.4 billion. These totals would mark changes of +101.15% and +54.16%, respectively, from last year.
Any recent changes to analyst estimates for Reddit Inc. should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Reddit Inc. is holding a Zacks Rank of #2 (Buy) right now.
In terms of valuation, Reddit Inc. is presently being traded at a Forward P/E ratio of 28.36. This denotes a premium relative to the industry average Forward P/E of 19.59.
It's also important to note that RDDT currently trades at a PEG ratio of 0.69. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Software industry had an average PEG ratio of 1.17 as trading concluded yesterday.
The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 92, placing it within the top 38% of over 250 industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
New partnership gives advertisers greater confidence to reach highly engaged communities through advanced AI-powered contextual intelligence
LOS ANGELES--(BUSINESS WIRE)--Zefr, the leading provider of AI-powered brand safety and suitability solutions for walled garden environments, today announced a partnership with Reddit to provide advertisers with advanced AI-powered content-level intelligence, insights, brand safety and suitability measurement solutions across Reddit's rapidly growing advertising platform.
Reddit has become an increasingly important destination for product discovery, research, recommendations, and purchase decisions, giving advertisers an opportunity to reach consumers within highly engaged, interest-driven communities. The depth and nuance that make these conversations valuable also create an opportunity for advertisers to reach relevant audiences and unlock valuable inventory with greater precision – but doing so requires contextually adaptive approaches to brand suitability. Through this partnership, advertisers can move beyond broad content classifications to better understand the context surrounding Reddit conversations, giving them greater confidence, transparency and control as they scale campaigns across the platform.
Rather than relying on restrictive filtering, Zefr's multimodal AI and contextual intelligence enables advertisers to better align campaigns with suitable conversations across Reddit, helping protect brand reputation while maximizing campaign performance. Together, Reddit's community-based platform and Zefr's industry-leading content understanding give advertisers greater confidence to scale investment in one of today's fastest-growing digital advertising channels and the ability to reach valuable audiences and uncover new opportunities for engagement.
“Our approach is about giving advertisers the intelligence to understand context, not just block against it. By bringing Zefr’s content intelligence to Reddit, we can help brands better understand where and how they show up, uncover valuable audiences, and ultimately turn greater transparency into greater opportunity and performance,” said Rich Raddon, Co-Founder and Co-CEO at Zefr.
“Reddit brings together communities across billions of posts and conversations, where people exchange knowledge, ask questions, and make decisions around the topics they care about. By working with Zefr, we’re helping brands account for the nuance of those conversations as they connect with the communities that matter to them most,” said Nishe Modoyan, Senior Director of Global Product Marketing at Reddit.
The announcement marks another milestone in Zefr's continued expansion across the world's largest walled gardens and social platforms. The company currently provides AI-powered brand safety, suitability, and verification solutions across YouTube, TikTok, Meta, Snapchat, and other leading digital platforms, helping global brands navigate increasingly complex content environments through transparent, AI-driven measurement and optimization.
The partnership also reflects the growing importance of contextual intelligence as AI transforms digital advertising. As consumer discovery increasingly shifts toward community-driven conversations and AI-powered search experiences, advertisers require deeper content understanding to effectively balance reach, relevance, and brand suitability. Zefr’s technology is designed to adapt to the unique needs and standards of individual brands, providing intelligence that can inform media quality, suitability, audience strategy, and campaign performance.
To learn more about how your brand can unlock the power of Reddit communities with Zefr, visit: https://zefr.com/contact-us.
About Zefr
Zefr is the leader in AI-powered content classifications for brands and advertisers. Zefr's platform is purpose built for multi-modal content understanding on open platforms like YouTube, TikTok, Meta and Snapchat, with pre-bid activation and verification solutions. Our products safeguard media and AI investments, while maximizing performance and efficacy on those channels. Headquartered in Los Angeles with global offices across New York, Chicago, London, Toronto, Singapore, and more, Zefr is redefining what trust and transparency means for social media in the age of AI. To learn more, visit zefr.com.
Amid a number of updates for moderators and developers announced Wednesday, comes bad news for supporters of a more open web: Reddit is ending support for RSS feeds.
Reddit says RSS has now become a “common surface for large-scale scraping and automated abuse,” which is why it’s made the decision to wind down RSS feeds on its platform.
“We know RSS has been a beloved part of the open web for a long time, and we’re grateful to everyone who used it to stay connected to Reddit,” the company noted in its announcement, where it also shared a March 2027 shutdown date for its public API.
Reddit said RSS support will cease on November 13.
RSS, or Really Simple Syndication/Rich Site Summary, is a web feed that lets users and applications access updates to a website in a standardized format. The format became particularly popular in the blogging era, as it offered a way to subscribe to a site’s new posts in a news-reading app. Google once operated the most popular of these, but shut it down in 2013, ceding the market to companies like Feedly and other indie applications.
The decision to kill Reddit’s RSS feeds comes at a time when the site’s treasure trove of user-generated content in its forums has become a profitable side business for the company in the form of AI licensing deals.
During its second quarter, Reddit said its “other revenue” beyond advertising had grown 24% year-over-year to $43 million. It’s no wonder that Reddit doesn’t want to give any of that data away for free.
For moderators who have relied on RSS channels for their own alerts, Reddit is now recommending a shift to the Discord Relay Devvit app. The company suggested that moderators and their teams review their setups and migrate their workflows before the shutdown date of November 13 to ensure there’s no disruption. However, Reddit said that there’s no replacement for the use of RSS feeds that were being used for feeds outside of the moderators’ community.
Moderators have already expressed worry about how this shift would impact their workflow. When Reddit hinted earlier that it was preparing for the end of RSS on its site, many responded by complaining that Reddit would become unmanageable for them. Meanwhile, many users stressed that RSS was how they enjoyed accessing Reddit’s content.
The RSS change was one of several updates issued on Wednesday by the company. Another big change will be the end of its public API.
Public API access will also end by March 2027, which will impact any tools that used it for programmatic access to Reddit conversations, including social listening products, those used by researchers, and AI products, such as AI assistants. Today, those assistants can use Reddit to answer questions, but after closing public API access, they will need commercial deals with Reddit for its data.
In addition, Reddit provided an update on its Rules Hub progress and auto-mod changes, and said it was “adding safeguards” to its classic, text-heavy version of its site known as Old Reddit. The latter will include limiting access to logged-in moderators and recent users — changes Reddit also said were required because of “abusive scraping and automated traffic.”
Reddit said in the next few months it will limit access for logged-in users to those who have used Old Reddit in the last 90 days.
The company also reminded developers building approved third-party apps and bots to register them with the company before January 12, 2027, to avoid disruption. After that date, Reddit will remove API access for any developer that hasn’t registered.
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Sarah has worked as a reporter for TechCrunch since August 2011. She joined the company after having previously spent over three years at ReadWriteWeb. Prior to her work as a reporter, Sarah worked in I.T. across a number of industries, including banking, retail and software.
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Reddit stock has remained under pressure this month, moving from a high of $207 in July to the current $143. It has also plunged by 50% from its highest point last year, with its market capitalization moving from over $51 billion to $27.5 billion today. This retreat may continue as website traffic drops.
RDDT stock has been struggling this year as concerns about its growth trajectory continue. One major issue is that traffic to its website continues falling, partly because of the challenges in search. SimilarWeb data shows that the number of visitors to the website dropped by 3.22% to 4.18 billion last month.
The company has blamed the slowing traffic to its relationship with Google, which now pays it $60 million a year to use its content to train its models. As a result, the Wall Street Journal recently reported that it was reconsidering the deal because Google’s AI summaries were affecting its business. In the last earnings report, the company’s CEO said:
“Search referrals were choppy in the quarter, and traffic was more volatile later in the quarter, but the bigger picture is unchanged: the commercial business is strong.”
Reddit stock has also retreated because of the recent S&P 500 Index inclusion. Historically, stocks tend to do well after being added in major indices like S&P 500 and Nasdaq 100. This surge is usually brief as the momentum fades. We saw this with companies like Robinhood Markets, CoreWeave, and Nebius.
Additionally, there were concerns about valuation, with its market capitalization peaking at over $54 billion. While the metric has improved, the current forward price-to-earnings ratio of 18 is also higher than the sector median of 13.
These metrics likely explain why analysts have slashed their targets. DA Davidson reduced the target to $185 from the previous $200. Morgan Stanley cut the target from $240 to $210, while JPMorgan reduced from $200 to $185.
On the positive side, there are signs that the company’s revenue is continuing to grow, with the number of users soaring. The number of daily active users rose to 130.3 million, up by 18% from a year earlier.
As a result, revenue rose by 61% to $805 million, with its advertising revenue being the biggest part of its business. Most notably, the gross margin rose to 91.3%, while the net income was over $253 million.
Most of Reddit’s revenue came from the United States, with its international segment making over $167 million.
Analysts expect the company to experience double-digit growth. The annual figure is expected to jump by 53% to $3.4 billion, followed by $4.46 billion next year.
RDDT stock chart | Source: TradingView
The daily chart shows that the stock also has some risky technicals. It has formed a head-and-shoulders pattern, which is a common bearish reversal sign in technical analysis. It is now hovering near this pattern’s neckline.
The stock has slumped below the 50-day Exponential Moving Average (EMA) and the Supertrend indicator. Also, the two lines of the MACD indicator have remained below the zero line.
Therefore, the path of the least resistance is bearish, with the initial target being the psychological level of $100. If this happens, it will be a 31% drop from the current level.
Digital advertising is evolving as platforms compete for limited marketing budgets. Choosing between Reddit (RDDT -1.89%) and The Trade Desk (TTD -0.24%) requires weighing community-driven content against the power of programmatic ad buying.
Reddit offers a unique platform built on user-generated communities, while The Trade Desk operates an independent demand-side platform for buying digital ads. Both companies are navigating a shift toward data-driven targeting and privacy changes among communication stocks. This comparison looks at their growth trajectories and valuations to see which holds the advantage for long-term investors.
The case for RedditReddit operates a massive network of user-governed communities where people discuss everything from finance to hobbies. The company sells advertising space across its platform, which accounted for approximately 94% of total revenue in 2025. It also relies on licensing its conversational data to technology firms for training artificial intelligence models.
While still in its early stages of monetization, these licensing deals provide a high-margin supplement to its core advertising business. According to its latest annual report for the 2025 fiscal year (FY), revenue reached $2.2 billion, representing significant growth of 69.4% compared to the prior year. The company reported net income of $529.7 million, a major improvement from the net loss reported in the prior fiscal year.
As of its December 2025 balance sheet, the debt-to-equity ratio was zero, meaning it has no total debt relative to shareholder equity. The current ratio, which measures the ability to pay short-term debts, is 11.6x. Free cash flow reached $684.2 million, though stock-based compensation (SBC) represented 49.7% of operating cash flow, which inflates reported cash generation since SBC is a non-cash expense.
The case for The Trade DeskThe Trade Desk provides a self-service platform that helps advertisers buy digital ad space across the open internet, including connected TV. It serves ad agencies through master services agreements, but customer concentration is a notable factor. Two holding companies each represented more than 10% of gross billings in 2025, which adds a layer of risk to the business.
In its latest annual report for FY 2025, revenue reached $2.9 billion, a growth rate of 18.5% over the previous year. The company reported a net income of $443.3 million, resulting in a net margin of 15.3%.
As of its December 2025 balance sheet, the debt-to-equity ratio was 0.2x, representing the amount of total debt compared to shareholder equity. The current ratio is 1.6x, meaning assets cover short-term liabilities. Free cash flow was $795.7 million, but stock-based compensation represented 49.4% of operating cash flow.
Risk profile comparisonReddit faces significant risks regarding user engagement and community moderation. If users or moderators become dissatisfied with platform changes, declines in activity could directly harm revenue. Furthermore, the company relies on external ecosystems like Apple (AAPL +1.53%) and Alphabet (GOOGL +0.46%) (GOOG +0.61%) for users to access the Reddit app.
The Trade Desk lacks exclusive, long-term contracts, allowing clients to shift their spending to rivals with short notice. It also depends on access to ad inventory from suppliers that may also be competitors, such as Amazon (AMZN +0.12%). Finally, evolving global privacy regulations and the removal of tracking identifiers pose substantial operational burdens.
Valuation comparisonReddit looks more expensive by its Forward P/E, which compares price to future earnings estimates, and P/S ratio, while The Trade Desk has the advantage in both valuation measures.
MetricRedditTrade DeskForward P/E19.5x10.9xP/S ratio10.5x2.0xValuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
Which stock would I buy in 2026?Reddit and The Trade Desk both rely on digital advertising to pay the bills. The Trade Desk's platform is all about facilitating digital ad campaigns, but despite this, Reddit is the stock to buy in 2026.
The arrival of artificial intelligence is changing the digital landscape. The potent AI capabilities of larger advertising rivals, such as Amazon and Alphabet-owned Google, give them an advantage that The Trade Desk is hard-pressed to match.
In fact, through the first half of 2026, The Trade Desk's $1.4 billion in revenue represents just a 7% year-over-year increase, a significant slowdown from 2025's 18.5% growth rate. Worse, the company expects Q3 sales to drop year over year to $650 million compared to $739 million in 2025. This suggests its business is in trouble.
Meanwhile, Reddit's core platform is about human connection and knowledge sharing. In an ever-expanding sea of AI-generated automation, the human element on Reddit helped it increase daily active unique users by 18% year-over-year to 130.3 million. As the user base grows, it attracts more advertisers. This key component makes Reddit an appealing long-term investment, especially since its user-generated content is not easily replicated by rivals.
Steve Ladd Huffman, Chief Executive Officer of Reddit, Inc. (RDDT -1.89%), sold 17,308 shares of Class A Common Stock on September 15, 2026, as disclosed in a recent SEC Form 4 filing.
Transaction summaryMetricValueTransaction value~$2.8 millionShares sold (indirectly held)17,308Post-transaction shares (indirectly held)343,329Post-transaction value~$54.81 millionTransaction value based on SEC Form 4 weighted average sale price ($160.11); post-transaction value based on September 15, 2026 market close ($159.63).
Key questionsHow was the transaction structured and what was the execution price?
The sale was a routine execution under a Rule 10b5-1 trading plan adopted on May 20, 2026, involving the exercise of 17,308 options at $25.29 per share followed by an immediate sale at a weighted average price of $160.11 per share.Which entities are used to maintain the executive's equity position?
Equity holdings are managed through indirect entities, including 336,432 shares held by The XYZ Revocable Trust and 6,897 shares held by a grantor retained annuity trust.How does this transaction affect the insider's long-term stake in the company?
The executive's total equity position remained unchanged at 343,329 shares because the disposition was offset by the acquisition of new shares through the exercise of vested options; additionally, the executive holds ~1.0 million derivative securities held indirectly.What is the current business focus and market context for the company?
The company operates an internet-based platform for diverse online communities organized by shared passions, and its stock was priced at $152.83 as of the September 17, 2026 market close following a one-year return of -39% as of the transaction date.Company OverviewMetricValueShare Price (as of market close 2026-09-17)$152.83Market Capitalization$29.1 billionRevenue (TTM)$2.8 billionNet Income (TTM)$871.1 millionCompany SnapshotReddit operates a user-generated content platform that generates revenue primarily through advertising, premium subscription services, and API licensing arrangements with enterprise customers seeking access to community data and insights.The company monetizes its engaged user base through targeted advertising placements within community feeds, sponsored content opportunities, and subscription-based premium features that enhance user experience across its platform.Reddit serves a diverse global audience ranging from individual consumers seeking community engagement to enterprise clients including technology companies, financial institutions, and research organizations requiring access to real-time community discussions and sentiment data.Reddit maintains a substantial scale with $2.8 billion in TTM revenue with net income of $871.1 million, reflecting strong operational profitability. The platform's competitive advantage derives from its unique community-driven architecture and the authentic, unfiltered nature of user-generated discussions, which create valuable datasets for both advertisers and enterprise customers. Reddit benefits from monetizing its highly engaged user communities through diversified revenue streams.
What this transaction means for investorsCEO Steve Huffman's September 15 sale of Reddit stock occurred after the share price had fallen 39% over the past 12 months through his transaction date. However, his disposition was a non-discretionary transaction executed as part of a pre-established Rule 10b5-1 plan. Such plans allow insiders to sell shares at predetermined times to avoid concerns of trading on non-public information.
Post-sale, Huffman retained a sizable equity stake, including more than one million stock options. This ensures his continued alignment with shareholder interests.
Although Reddit shares have declined over the past year, the company is doing well. In the second quarter, Reddit achieved $804.9 million in Q2 sales, which represents the eighth consecutive quarter of more than 60% year-over-year revenue growth. This massive increase was due to daily active users rising 18% year over year to 130.3 million. More users means more advertising can be put in front of those people.
Robert Izquierdo has positions in Reddit. The Motley Fool has positions in and recommends Reddit. The Motley Fool has a disclosure policy.
Reddit Inc. (RDDT - Free Report) closed at $149.84 in the latest trading session, marking a -1.89% move from the prior day. The stock fell short of the S&P 500, which registered a gain of 0.51% for the day. On the other hand, the Dow registered a gain of 0.93%, and the technology-centric Nasdaq increased by 0.48%.
Coming into today, shares of the company had lost 0.8% in the past month. In that same time, the Computer and Technology sector gained 6.54%, while the S&P 500 gained 0.74%.
The upcoming earnings release of Reddit Inc. will be of great interest to investors. In that report, analysts expect Reddit Inc. to post earnings of $1.3 per share. This would mark year-over-year growth of 62.5%. In the meantime, our current consensus estimate forecasts the revenue to be $886.35 million, indicating a 51.54% growth compared to the corresponding quarter of the prior year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $5.27 per share and revenue of $3.4 billion, which would represent changes of +101.15% and +54.16%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Reddit Inc. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Reddit Inc. is holding a Zacks Rank of #3 (Hold) right now.
In the context of valuation, Reddit Inc. is at present trading with a Forward P/E ratio of 28.97. This signifies a premium in comparison to the average Forward P/E of 19.18 for its industry.
It is also worth noting that RDDT currently has a PEG ratio of 0.71. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Software industry currently had an average PEG ratio of 1.18 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 91, positioning it in the top 37% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
Key Takeaways Reddit's international revenues jumped 84% as DAUq rose 28% and WAUq climbed 35%. International ARPU rose 31% to $2.26, while global ARPU increased 36% on pricing and impressions. Advertising revenue surged 64% to $762M as active advertisers grew more than 70%. Reddit (RDDT - Free Report) is benefiting from the rapid expansion of its global user and advertiser footprint, which is strengthening its competitive position against Pinterest (PINS - Free Report) and Snap (SNAP - Free Report) in the digital advertising market.
In the second quarter of 2026, Reddit’s international revenues surged 84% year over year to $166.8 million, outpacing 56% growth in U.S. revenues. International daily active uniques (DAUq) increased 28% to 77.1 million, while international weekly active uniques (WAUq) jumped 35% to 317.4 million. The expanding international audience strengthens Reddit’s ability to attract global advertisers and compete with social-media platforms such as Pinterest and Snap. Reddit averaged 130.3 million daily active uniques globally in the second quarter, up 18% year over year, while weekly active uniques increased 24% to 514.6 million.
Improving monetization of this expanding overseas audience is another key catalyst. International average revenue per unique (ARPU) increased 31% year over year to $2.26 from $1.73. Meanwhile, global ARPU rose 36% to $6.18 from $4.53, supported by higher advertising pricing and impressions.
Reddit’s advertising momentum should further support its international expansion. Second-quarter advertising revenues jumped 64% year over year to $762 million, supported by higher pricing and impressions. Active advertisers increased more than 70%, while revenues from the scaled channel, which includes mid-market and small and medium-sized businesses, doubled. Management also noted that Rest of World revenues grew more than 80%, reflecting increasingly diversified advertiser demand across markets.
RDDT’s expanding international portfolio and rising user engagement are expected to drive the company’s top-line growth. For the third quarter of 2026, management expects revenues between $860 million and $870 million. The midpoint implies about 48% year-over-year growth.
RDDT Faces Stiff CompetitionReddit is facing stiff competition from Pinterest and Snap. Both companies are also expanding their global footprint to compete in the rapidly growing digital ad market.
Pinterest continues to expand monetization outside its core United States and Canada market through broader advertiser coverage and go-to-market initiatives. In the second quarter of 2026, Europe revenues increased 12% year over year to $213 million, while Rest of World revenues increased 38% to $87 million. Management is applying the UCAN go-to-market approach internationally while refining sales execution.
SNAP is benefiting from strong international expansion, as evidenced by its global monthly active users reaching 493 million daily active users in the second quarter of 2026, up 5% year over year. Snap reported 971 million monthly active users (MAU), up 4% year over year, moving closer to the company’s long-stated goal of 1 billion MAUs.
RDDT’s Share Price Performance, Valuation and EstimatesReddit shares have plunged 33.6% year to date, underperforming the broader Zacks Computer & Technology sector’s 21.9% appreciation and the Internet - Software industry’s increase of 11.4%.
RDDT Stock Performance
Image Source: Zacks Investment Research
RDDT shares are overvalued, with a forward 12-month Price/Sales of 6.98X compared with the Computer & Technology sector’s 6.18X. RDDT has a Value Score of D.
RDDT Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings is pegged at $5.27 per share, which has decreased 1.12% over the past 30 days. This suggests 101.15% year-over-year growth.
RDDT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Reddit Inc. (RDDT - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this company have returned -0.8%, compared to the Zacks S&P 500 composite's +0.7% change. During this period, the Zacks Internet - Software industry, which Reddit Inc. falls in, has gained 16.6%. The key question now is: What could be the stock's future direction?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Reddit Inc. is expected to post earnings of $1.30 per share, indicating a change of +62.5% from the year-ago quarter. The Zacks Consensus Estimate has changed -2% over the last 30 days.
The consensus earnings estimate of $5.27 for the current fiscal year indicates a year-over-year change of +101.2%. This estimate has remained unchanged over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $6.94 indicates a change of +31.6% from what Reddit Inc. is expected to report a year ago. Over the past month, the estimate has remained unchanged.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Reddit Inc. is rated Zacks Rank #3 (Hold).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of Reddit Inc., the consensus sales estimate of $886.35 million for the current quarter points to a year-over-year change of +51.5%. The $3.4 billion and $4.51 billion estimates for the current and next fiscal years indicate changes of +54.2% and +32.8%, respectively.
Last Reported Results and Surprise HistoryReddit Inc. reported revenues of $804.91 million in the last reported quarter, representing a year-over-year change of +61.1%. EPS of $1.25 for the same period compares with $0.45 a year ago.
Compared to the Zacks Consensus Estimate of $743.93 million, the reported revenues represent a surprise of +8.2%. The EPS surprise was +26.26%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Reddit Inc. is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Reddit Inc.. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
The digital advertising landscape is evolving rapidly as automated tools and social platforms fight for attention. AppLovin (APP -1.25%) and Reddit (RDDT -0.27%) represent two distinct paths to growth for investors seeking exposure to this trend.
AppLovin focuses on the technical side of mobile growth, while Reddit centers on the power of community engagement. Both businesses are vying for a larger slice of the digital advertising market, making them popular choices for investors exploring high-growth opportunities.
The case for AppLovinWithin the tech stocks category, AppLovin provides software solutions that help mobile app developers reach new users and earn money through advertising. Its core platform includes tools like Axon for ad management and MAX for in-app bidding to optimize mobile monetization. The company recently expanded into web-based e-commerce after divesting its internal apps business in June 2025 and does not rely on long-term client agreements.
In FY 2025, revenue reached nearly $5.5 billion, marking an increase of approximately 70% compared to the previous year. This rapid expansion helped the company generate a net income of roughly $3.3 billion during the period, compared to approximately $1.6 billion in the previous year. The net margin, which shows how much profit is kept from each dollar of sales, sat at a robust 60.8% for the fiscal year.
As of its December 2025 balance sheet, the debt-to-equity ratio was approximately 1.7x. This metric, which divides total debt by shareholder equity, indicates the company uses a moderate amount of borrowing to fund its growth. The current ratio, which measures the ability to pay short-term bills using short-term assets, was close to 3.3x, and free cash flow reached nearly $3.9 billion.
The case for RedditReddit operates a massive network of user-led communities focused on thousands of specific interests, generating approximately 94% of its revenue through advertising. The company has also begun licensing its conversation data to help train generative artificial intelligence models. While this opens new revenue streams, it remains dependent on cloud providers like Amazon (AMZN +0.14%) for infrastructure and faces concentration risks among a small number of top advertisers.
In FY 2025, the company reported revenue of close to $2.2 billion, representing year-over-year growth of roughly 69.4%. This strong performance resulted in a net income of approximately $529.7 million for the fiscal year, a significant improvement over the net loss reported in the prior year. The net margin improved significantly as the business scaled, reaching nearly 24.1% for the period.
The company maintains a very conservative balance sheet with a debt-to-equity ratio of 0.0x as of December 2025. Its current ratio was roughly 11.6x, and free cash flow for the period reached close to $684.2 million. Note that stock-based compensation represented roughly 49.7% of operating cash flow, which inflates reported cash generation since SBC is a non-cash expense added back in the cash flow statement.
Risk profile comparisonAppLovin faces several challenges, including multiple federal securities class action lawsuits involving its AI tools and advertising model improvements. The company also deals with intense competition for ad dollars from major players like Meta Platforms and Alphabet. Furthermore, changes to privacy policies from platform owners like Apple (AAPL +0.23%) could limit its ability to track users effectively, especially given competition from Unity Software (U -8.87%).
Reddit is highly dependent on its daily active unique users, and any decline in engagement could significantly harm its advertising revenue. The platform relies on volunteer moderators whose actions can disrupt site operations, and it competes for advertising budgets against established giants like Meta Platforms and Snap (SNAP +0.38%). Regulatory scrutiny regarding content moderation and the platform's dependency on external search engine algorithms for traffic remain persistent concerns.
Valuation comparisonReddit trades at a higher Forward P/E relative to future earnings estimates, while AppLovin carries a higher P/S ratio based on sales over the past twelve months.
MetricAppLovinRedditForward P/E20.1x28.3xP/S ratio15.5x10.6xValuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
I'd go with Reddit. Its advertising revenue has grown at a strong pace for seven consecutive quarters, and weekly active users crossed half a billion for the first time in Q2 2026. Its AI licensing business, which sells access to its enormous archive of human conversation to technology companies, adds a revenue stream that is impossible to replicate. Reddit is also newly profitable, which changes the investment conversation in ways that matter.
AppLovin has built one of the most profitable advertising platforms in digital media, with margins that most software companies would envy. But a Q2 revenue miss and below-consensus guidance introduced uncertainty at a moment when the stock was already under pressure.
Both companies are interesting ways to play digital advertising, and reasonable investors could make a case for either one. Reddit's combination of consistent growth, new profitability, and a unique data asset feels like the more durable foundation from here. Though it is worth watching how AppLovin's expansion into e-commerce advertising develops over the coming quarters.
Meta's AI agent Muse is driving a month-long stock rally that has investors questioning whether the company's heavy AI spending is finally paying off in ways that could reshape its business far beyond advertising.
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Meta Platforms (NASDAQ:META | META Price Prediction) stock is extending a month-long advance Thursday as investor enthusiasm around its new Muse artificial intelligence agent continues to build. Shares of META stock are up 3% to $768.46, while Reddit (NYSE:RDDT) stock is edging 0.68% higher to $153.01.
The gains come even as the broader market is little changed, with Global X Social Media ETF (NASDAQ:SOCL) unchanged at $43.83 and SPDR S&P 500 ETF Trust (NYSE ARCA:SPY) down 0.03% to $767.62. Meta’s recent momentum has increasingly centered on Muse, while Reddit is participating in a much more modest move across social-media stocks.
Muse Keeps Meta’s Momentum Going Meta’s Muse agent has quickly become a major focus for investors following its September launch. Meta is expanding Muse across apps and services, with the company positioning the agent as a system that can handle tasks such as email, travel and transactions rather than simply answer questions.
Moreover, Meta’s latest Connect event added to that story by introducing more Muse capabilities and integrations, including plans to bring the agent to Meta’s smart glasses. Meta’s broader AI strategy could give investors another reason to focus on potential monetization beyond the company’s traditional advertising business.
AI Spending Faces A New Test Meta Platforms has spent heavily on artificial intelligence infrastructure and products, making evidence of consumer adoption particularly important to the investment story. Muse’s early traction provides a potential indication that Meta’s AI spending can translate into products that users engage with, although the longer-term financial contribution remains uncertain.
The monetization opportunity is also evolving as Meta considers taking a small fee from transactions completed through Muse. Meta has announced integrations involving payments, retailers, travel and grocery services, creating several potential paths for Muse to become part of everyday consumer activity.
Reddit Gets A Smaller Lift Reddit is gaining alongside Meta, although Reddit’s move is considerably smaller and the company’s investment story is different. Reddit’s platform gives investors exposure to online communities and advertising, while Meta has been pushing deeper into artificial intelligence assistants, wearables and other consumer technology.
The broader social-media backdrop remains relatively calm, as shown by the unchanged Global X Social Media ETF. Reddit stock’s modest gain therefore suggests investors are giving the company some support even as the strongest momentum in the group remains concentrated around Meta’s AI developments.
Looking Ahead: Meta’s Rally Meets Higher Expectations Meta Platforms stock’s continued rise is also raising the stakes for future execution because a stronger share price can reflect higher expectations for Muse and the company’s AI investments. Meta’s ability to turn early consumer interest into sustained usage and meaningful revenue could become increasingly important as investors assess whether the recent run can continue.
For Reddit, the key considerations remain tied more closely to user engagement, advertising and the company’s ability to monetize its large collection of online communities. Investors should watch for signs that Meta’s Muse adoption is translating into durable monetization while Reddit continues developing its own growth opportunities, with both stocks remaining exposed to shifts in broader technology and social-media sentiment.
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Adam Collins, Reddit's chief communications officer, wants to preserve the platform's human qualities. Reddit Reddit is ratcheting up its war on marketing slop.
The company exclusively told CMO Insider that it's taking new steps to combat spam and keep human conversations at the center of its platform.
First, it'll prevent suspected spam from appearing in the main home feed while it's under review. Reddit said in testing, this approach cut spam in the home feed by 28%, user reports of spam in the feed by 11%, and push notifications with spam by 7%. It plans to test this approach in search results next.
Reddit is also taking a few other steps:
It plans to start explaining to users why it suspects certain content is spam, rather than just showing "Removed by Reddit"It won't recommend posts or comments from accounts that have been asked to verify they're human or register their automation, but haven't yet done so"What's made Reddit really unique over the last 21 years, and special, is the humanity that you see on Reddit every day," said Adam Collins, Reddit's chief communications officer. "Our goal is to preserve that for the future as well. That's really what these efforts are about."
Reddit said it had uncovered a coordinated network of 485 accounts that created more than 44,000 pieces of content across the platform, often about work and productivity. These accounts presented themselves as regular users but were, in fact, connected to businesses, violating Reddit's rules requiring marketing activity to be disclosed.
Reddit said it reversed the potential benefit of the coordinated behavior by removing karma and votes that resulted from the manipulation. Karma is a score on Reddit that measures a user's reputation.
The spam problem is a particular threat to Reddit, which considers its human-moderated communities to be its greatest advantage over other social platforms.
Reddit vs. AIAfter going public in 2024, Reddit increased advertising on its forums and entered into partnerships with OpenAI and Google.
Marketers took note and have been racing to create content for Reddit. Brands particularly hope their efforts will help them show up in AI search, where Reddit is highly cited. The problem: Self-promotional content from brands, especially if they use AI to make it, risks harming the human quality that Reddit sees as setting itself apart from other platforms.
A July report from the AI detection firm Pangram found that Reddit was the least affected by AI among five platforms, with 3% of its short-form content flagged as AI. LinkedIn was at the high end at 30%.
Reddit has been proactive. In July, Reddit announced tools to combat AI-enabled promotional content and spam.
Reddit said at the time that these tools helped catch 23 million spam views per day and cut users' exposure to spam by about 20% in the period from January to March 2026, compared to the prior three months.
Collins said that while some commercial spam is obvious to users, these tools were able to catch subtler instances, such as spam accounts that appeared to be people interacting with each other.
Moderation is an ongoing Whac-A-Mole game, though, and as long as spammers keep finding workarounds, Reddit's work will continue.
"The conversations that are happening on Reddit have value," Collins said. "We have to continue to adjust and continue to improve our efforts to remove that kind of content to make sure that it continues to be that great value of a place for users."
What marketers are sayingAgency execs who spoke with CMO Insider said brands that use Reddit as intended — by listening to their consumers and being useful to them — won't be affected by the spam crackdown.
"The brands that win will earn participation by being transparent, useful, and native to each community, while giving customers genuine reasons to talk about them," said Joe Gagliese, co-CEO of Viral Nation.
Brian Yamada, chief innovation officer at VML, said the sugar rush some brands got by manipulating Reddit would be short-lived.
Slop isn't going away, though, he added.
"It's not just a Reddit problem," Yamada said. "The flood of generative AI slop is likely to continue as brands or companies are looking for shortcuts or cheats to get visible."
Collins said Reddit has an appeals process to correct false positives and that it's letting suspected spam remain while it's under review.
Moderators and users play an important gatekeeping role on Reddit, and Collins said that wouldn't change. Moderators can still review and approve content for their communities, but limiting suspected spam during a review period would help prevent users from being exposed to it, he said.
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Lucia Moses You're currently following this author! Click to unsubscribe from email alerts.
Lucia Moses covers the media and entertainment business, with a focus on how creators build businesses, how media companies intersect with creators, and how marketers adopt entertainment tools. She's broken stories about MrBeast's ambitions, Google's movie initiative, and Netflix's push into podcasts.She previously reported on media and managed teams at Digiday and Adweek.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of RDDT, GOOG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Pinterest keeps sliding lower while its closest peers barely flinch, and no news has surfaced to explain the gap. Something is moving inside Pinterest's shareholder base, and the pattern is getting harder to ignore.
Shares of Pinterest (NYSE:PINS | PINS Price Prediction) are extending a month-long slide in Tuesday afternoon trading, and no company-specific news has surfaced to hang the decline on. Pinterest stock is at $18.48, down 5%, deepening a decline that has been running for weeks without any visible fresh catalyst. That combination, a large single-session drop layered on top of a sustained downtrend, is the story.
A framing contrast makes the isolation clear. The Communication Services Select Sector SPDR Fund (NYSEARCA:XLC) is at $113.95, down 0.7%, and the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is at $773.23 and essentially unchanged. Neither the sector fund nor the broad benchmark is doing much of anything, which points selling squarely at Pinterest rather than at digital-advertising demand in general.
Peer figures push in the same direction. Reddit (NYSE:RDDT) stock is at $154.93, down 2%, moving with far less conviction than Pinterest, while Snap (NYSE:SNAP) stock is at $5.67, down 0.5%, holding roughly flat. That dispersion is what a company-specific repricing looks like, not a broad social-advertising scare.
Pinterest Stock Carries Its Own Loss Pinterest stock is down 21% over the past month, a stretch of selling that dwarfs today’s single-session decline and reframes the move as continuation rather than shock. A name still making new ground lower after that much distribution is telling holders something, and today’s action shows it isn’t a sector story. The XLC ETF’s small dip and SPY’s flat reading leave Pinterest alone on its own price chart.
No advertising-sector news has crossed to explain the pressure, and Pinterest itself hasn’t issued a release this session. The likeliest reading is single-name selling in a stock that has been under water for weeks, offered as a mechanism the figures support rather than as a confirmed cause. Buyers who tried to catch the earlier legs of this slide in Pinterest haven’t been rewarded, and today’s action suggests the last of them are stepping back.
What the Peer Group Says About Pinterest The closest listed comparable stocks for Pinterest in social advertising are Reddit and Snap, and neither is participating in the decline in any meaningful way. Reddit is drifting lower on its own terms and Snap is essentially unmoved, so today’s price action across the three names shows dispersion rather than a shared verdict on digital-ad budgets. That is rotation, not a sector-wide judgment.
The Communication Services Select Sector SPDR Fund’s marginal loss, alongside SPY sitting still, closes the door on the idea that Pinterest is being dragged by something happening above it in the broader market. Whatever is driving the selling in Pinterest is happening inside its own shareholder book, not across social platforms or communication services more widely.
Bull and Bear Cases for Pinterest The bear case for Pinterest is direct. A stock down 21% in a month and still slipping is one where holders aren’t finished leaving, and the absence of any fresh trigger doesn’t soften the pattern. It hardens the pattern, because price is doing work without help from news, and that kind of quiet selling in Pinterest tends to persist until supply is exhausted.
Pinterest bulls read the same figures differently. A de-rating this deep in the stock already discounts a great deal of disappointment, and nothing verified today changed anything about the underlying business itself. Buyers willing to sit through more chop in Pinterest may find the setup improves once forced selling clears, particularly if the next earnings release confirms the operating trajectory holders have been fleeing.
What to Watch Next Traders can watch for whether Pinterest stock finds a floor near current levels or slides further as the session closes, since a name in a month-long downtrend usually needs a visible stabilization signal before dip buyers commit real capital. The past-month figure on Pinterest is the frame to carry forward, because it puts any single session in its proper place.
Investors sizing their exposure to Pinterest stock should keep their positions modest until the selling steadies, favoring smaller stakes and staged entries over full commitments in a stock that continues to make new lows. If Reddit or Snap shares begin to sell off in sympathy with Pinterest in coming sessions, the story shifts from a single-name repricing to something larger, and investors should scale their risk accordingly.
Contact [email protected] for any questions or corrections.
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?
Let's take a look at what these Wall Street heavyweights have to say about Reddit Inc. (RDDT - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Reddit Inc. currently has an average brokerage recommendation (ABR) of 1.81, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 31 brokerage firms. An ABR of 1.81 approximates between Strong Buy and Buy.
Of the 31 recommendations that derive the current ABR, 19 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 61.3% and 3.2% of all recommendations.
Brokerage Recommendation Trends for RDDT
Check price target & stock forecast for Reddit Inc. here>>>
The ABR suggests buying Reddit Inc., but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
In other words, their interests aren't always aligned with retail investors, rarely indicating where the price of a stock could actually be heading. Therefore, the best use of this information could be validating your own research or an indicator that has proven to be highly successful in predicting a stock's price movement.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
Analysts employed by brokerage firms have been and continue to be overly optimistic with their recommendations. Since the ratings issued by these analysts are more favorable than their research would support because of the vested interest of their employers, they mislead investors far more often than they guide.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is RDDT Worth Investing In?In terms of earnings estimate revisions for Reddit Inc., the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $5.27.
Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Reddit Inc. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for Reddit Inc.
Corient Private Wealth LP boosted its holdings in shares of Reddit Inc. (NYSE:RDDT – Free Report) by 141.6% in the 2nd quarter, according to the company in its most recent 13F filing with the Securities & Exchange Commission. The firm owned 29,914 shares of the company’s stock after purchasing an additional 17,531 shares during the quarter. Corient Private Wealth LP’s holdings in Reddit were worth $5,192,000 at the end of the most recent quarter.
Several other hedge funds have also recently added to or reduced their stakes in the business. Sunbelt Securities Inc. raised its position in shares of Reddit by 87.5% during the 1st quarter. Sunbelt Securities Inc. now owns 195 shares of the company’s stock valued at $26,000 after acquiring an additional 91 shares during the last quarter. Ascentis Independent Advisors acquired a new position in shares of Reddit during the 1st quarter worth approximately $30,000. EverSource Wealth Advisors LLC grew its position in Reddit by 48.1% during the second quarter. EverSource Wealth Advisors LLC now owns 197 shares of the company’s stock worth $34,000 after buying an additional 64 shares in the last quarter. Beacon Investment Advisory Services Inc. bought a new stake in Reddit during the second quarter worth about $35,000. Finally, V Square Quantitative Management LLC acquired a new position in shares of Reddit in the 1st quarter valued at approximately $43,000.
Wall Street Analysts Forecast Growth RDDT has been the topic of a number of recent analyst reports. Wedbush decreased their target price on Reddit from $250.00 to $221.00 and set an “outperform” rating on the stock in a research report on Friday, July 31st. KeyCorp began coverage on Reddit in a report on Wednesday, July 29th. They issued an “overweight” rating and a $225.00 target price on the stock. Wall Street Zen cut shares of Reddit from a “buy” rating to a “hold” rating in a research report on Sunday, August 9th. Evercore reaffirmed an “outperform” rating and set a $265.00 price objective on shares of Reddit in a research note on Friday, July 31st. Finally, Sanford C. Bernstein reaffirmed a “market perform” rating and issued a $180.00 price objective on shares of Reddit in a research note on Friday, July 31st. Two equities research analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and twelve have issued a Hold rating to the company’s stock. According to data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average price target of $219.29.
Get Our Latest Stock Analysis on Reddit Insider Transactions at Reddit In other Reddit news, Director Robert A. Sauerberg sold 5,128 shares of the company’s stock in a transaction on Tuesday, August 25th. The stock was sold at an average price of $159.92, for a total transaction of $820,069.76. Following the transaction, the director directly owned 27,087 shares in the company, valued at $4,331,753.04. This represents a 15.92% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Steve Huffman sold 17,308 shares of the stock in a transaction dated Tuesday, September 15th. The shares were sold at an average price of $160.11, for a total value of $2,771,183.88. Following the completion of the sale, the chief executive officer directly owned 336,432 shares in the company, valued at $53,866,127.52. This represents a 4.89% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 230,244 shares of company stock valued at $38,747,524 in the last 90 days. Corporate insiders own 28.48% of the company’s stock.
Trending Headlines about Reddit Here are the key news stories impacting Reddit this week:
Positive Sentiment: A Yahoo Finance analysis argues that RDDT could be approximately 51% undervalued following its recent decline, supporting the view that the stock’s long-term growth potential is not fully reflected in its current valuation. Reddit could be 51% undervalued Positive Sentiment: Guggenheim maintained a Buy rating on Reddit, adding support to the bullish case. The broader analyst consensus remains Moderate Buy, with an average target price of $221.10. Guggenheim remains a Buy on Reddit Neutral Sentiment: BNP Paribas Exane initiated coverage with a Neutral rating and a $180 price target. The target implies meaningful upside from the referenced share price, but the neutral rating reflects caution about Reddit’s outlook and valuation. BNP Paribas Exane coverage Neutral Sentiment: Analyst opinions remain divided, with some firms emphasizing Reddit’s strong growth and others taking a more cautious stance. This disagreement can increase volatility and limit near-term investor conviction. Mixed analyst opinions on Reddit Negative Sentiment: Reddit insiders sold shares in several recent transactions. COO Jennifer Wong sold 60,000 shares for about $9.7 million, while CEO Steve Huffman sold 17,308 shares for approximately $2.8 million. Both sales were made under pre-arranged Rule 10b5-1 plans and the executives retained sizable holdings, but the transactions may still weigh on sentiment. Reddit insider sales Reddit Trading Down 1.3% Shares of Reddit stock opened at $150.84 on Friday. The firm’s 50 day simple moving average is $163.00 and its two-hundred day simple moving average is $159.45. The firm has a market capitalization of $29.02 billion, a price-to-earnings ratio of 35.08, a PEG ratio of 0.71 and a beta of 2.02. Reddit Inc. has a 12-month low of $119.27 and a 12-month high of $271.99.
Reddit (NYSE:RDDT – Get Free Report) last released its earnings results on Thursday, July 30th. The company reported $1.25 EPS for the quarter, topping analysts’ consensus estimates of $0.95 by $0.30. The firm had revenue of $804.91 million during the quarter, compared to the consensus estimate of $731.00 million. Reddit had a return on equity of 29.02% and a net margin of 31.35%.The company’s revenue was up 61.0% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.45 earnings per share. On average, sell-side analysts predict that Reddit Inc. will post 5.27 EPS for the current fiscal year.
Reddit Profile (Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and discussions. Users can submit posts, links, images and videos, while community members can comment, vote and interact through publicly accessible forums known as subreddits.
The company generates revenue primarily through digital advertising and also offers premium memberships and other paid products. Reddit additionally provides data licensing and developer-related services that support the use of its platform content and technology.
Founded in 2005 by Steve Huffman, Alexis Ohanian and Aaron Swartz, Reddit serves users worldwide across a broad range of communities.
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In the latest trading session, Reddit Inc. (RDDT - Free Report) closed at $150.84, marking a -1.3% move from the previous day. This change lagged the S&P 500's daily gain of 0.17%. On the other hand, the Dow registered a loss of 0.18%, and the technology-centric Nasdaq increased by 0.4%.
Heading into today, shares of the company had gained 1.68% over the past month, outpacing the Computer and Technology sector's gain of 0.37% and the S&P 500's loss of 1.29%.
The investment community will be closely monitoring the performance of Reddit Inc. in its forthcoming earnings report. It is anticipated that the company will report an EPS of $1.3, marking a 62.5% rise compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $886.35 million, indicating a 51.54% increase compared to the same quarter of the previous year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $5.27 per share and a revenue of $3.4 billion, signifying shifts of +101.15% and +54.16%, respectively, from the last year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Reddit Inc. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.97% higher. Reddit Inc. is holding a Zacks Rank of #3 (Hold) right now.
Looking at valuation, Reddit Inc. is presently trading at a Forward P/E ratio of 28.99. This indicates a premium in contrast to its industry's Forward P/E of 20.16.
It's also important to note that RDDT currently trades at a PEG ratio of 0.71. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Internet - Software industry currently had an average PEG ratio of 1.14 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 78, placing it within the top 32% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
Reddit Inc. (NYSE:RDDT – Get Free Report) COO Jennifer Wong sold 60,000 shares of the firm’s stock in a transaction dated Monday, September 14th. The stock was sold at an average price of $162.33, for a total transaction of $9,739,800.00. Following the transaction, the chief operating officer owned 1,012,226 shares of the company’s stock, valued at approximately $164,314,646.58. This represents a 5.60% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.
Reddit Trading Down 3.0% NYSE RDDT opened at $152.82 on Friday. Reddit Inc. has a 1-year low of $119.27 and a 1-year high of $282.95. The company has a market capitalization of $29.40 billion, a price-to-earnings ratio of 35.54, a PEG ratio of 0.73 and a beta of 2.02. The stock’s 50 day moving average is $163.89 and its two-hundred day moving average is $159.52.
Reddit (NYSE:RDDT – Get Free Report) last issued its earnings results on Thursday, July 30th. The company reported $1.25 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.95 by $0.30. The business had revenue of $804.91 million during the quarter, compared to analysts’ expectations of $731.00 million. Reddit had a return on equity of 29.02% and a net margin of 31.35%.Reddit’s quarterly revenue was up 61.0% compared to the same quarter last year. During the same period in the prior year, the firm posted $0.45 EPS. On average, analysts predict that Reddit Inc. will post 5.27 earnings per share for the current year.
Reddit News Roundup Here are the key news stories impacting Reddit this week: Positive Sentiment: Guggenheim maintained a Buy rating on Reddit, providing continued analyst support for the shares. The broader analyst consensus remains “Moderate Buy,” with an average price target of $221.10. Guggenheim remains a Buy on Reddit Positive Sentiment: Reddit’s latest results showed strong operating momentum: quarterly revenue rose 61% year over year to $804.9 million, exceeding expectations, while adjusted earnings also beat consensus. This performance supports the long-term growth case, although it is not a new announcement in this news cycle. Neutral Sentiment: Co-founder Alexis Ohanian said the technology industry has been “tone deaf” in communicating artificial-intelligence risks. His comments focus on improving the public debate around AI and do not indicate a change to Reddit’s strategy or financial outlook. Reddit co-founder discusses AI risks Negative Sentiment: COO Jennifer Wong sold 60,000 Reddit shares for approximately $9.7 million, reducing her direct ownership by 5.6%. CEO Steve Huffman separately sold 17,308 shares worth about $2.8 million. Both transactions were conducted under pre-arranged Rule 10b5-1 trading plans, which can reduce their significance as discretionary bearish signals, but the combined selling may still weigh on sentiment. Reddit COO insider sale Reddit CEO SEC filing Wall Street Analyst Weigh In A number of brokerages have issued reports on RDDT. Wells Fargo & Company cut their price objective on Reddit from $187.00 to $142.00 and set an “equal weight” rating for the company in a report on Friday, July 31st. DA Davidson reaffirmed a “buy” rating and issued a $200.00 target price on shares of Reddit in a report on Thursday, July 23rd. UBS Group reiterated a “buy” rating on shares of Reddit in a research report on Friday, July 31st. Wall Street Zen downgraded shares of Reddit from a “buy” rating to a “hold” rating in a report on Sunday, August 9th. Finally, Wedbush reduced their price target on shares of Reddit from $250.00 to $221.00 and set an “outperform” rating on the stock in a research report on Friday, July 31st. Two research analysts have rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and eleven have assigned a Hold rating to the stock. Based on data from MarketBeat, Reddit has an average rating of “Moderate Buy” and an average target price of $221.10.
Check Out Our Latest Report on Reddit
Institutional Trading of Reddit Large investors have recently made changes to their positions in the business. Wellington Management Group LLP raised its position in shares of Reddit by 21.8% in the 2nd quarter. Wellington Management Group LLP now owns 1,564,535 shares of the company’s stock valued at $271,572,000 after acquiring an additional 280,030 shares during the period. Handelsbanken Fonder AB grew its holdings in Reddit by 22.9% during the fourth quarter. Handelsbanken Fonder AB now owns 37,000 shares of the company’s stock valued at $8,505,000 after purchasing an additional 6,900 shares during the period. Berkshire Capital Holdings Inc. grew its holdings in Reddit by 326,400.0% during the fourth quarter. Berkshire Capital Holdings Inc. now owns 32,650 shares of the company’s stock valued at $7,505,000 after purchasing an additional 32,640 shares during the period. Moore Capital Management LP increased its stake in Reddit by 611.4% in the second quarter. Moore Capital Management LP now owns 12,577 shares of the company’s stock valued at $2,183,000 after purchasing an additional 10,809 shares in the last quarter. Finally, Norges Bank bought a new stake in Reddit in the fourth quarter valued at approximately $372,047,000.
Reddit Company Profile (Get Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and discussions. Users can submit posts, links, images and videos, while community members can comment, vote and interact through publicly accessible forums known as subreddits.
The company generates revenue primarily through digital advertising and also offers premium memberships and other paid products. Reddit additionally provides data licensing and developer-related services that support the use of its platform content and technology.
Founded in 2005 by Steve Huffman, Alexis Ohanian and Aaron Swartz, Reddit serves users worldwide across a broad range of communities.
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Jennifer L. Wong, Chief Operating Officer of Reddit, Inc. (RDDT -3.03%), reported a sale of 60,000 shares of Class A Common Stock on September 14, 2026, according to an SEC Form 4 filing.
Transaction summaryMetricValueTransaction value~$9.7 millionShares sold60,000Post-transaction shares (directly held)1,012,226Post-transaction shares (indirectly held)36,000Post-transaction value~$170.21 millionTransaction value based on SEC Form 4 weighted average sale price ($162.33); post-transaction value based on September 14, 2026 market close ($162.38).
Key questionsHow does this transaction relate to Wong's total equity compensation?
The sale was tied to the exercise of 60,000 stock options at a strike price of $20.76 per share. Following the completion of this transaction, Wong continues to hold 45,437 fully vested derivative securities, alongside an equity position of ~1.0 million shares.What was the market context at the time of the sale?
The transaction was executed at a weighted average price of $162.33 as the stock's one-year total return stood at -36% as of the September 14, 2026 transaction date.Does the use of a Rule 10b5-1 plan affect the interpretation of this activity?
The disposition followed a trading plan established on May 12, 2026. The use of this plan indicates that the timing and volume of the sale were determined well in advance, reflecting a scheduled liquidity event rather than a discretionary response to recent share price performance or company developments.What is the scale of Wong's remaining interest in the company?
With total beneficial ownership of ~1.0 million shares and an additional 45,437 derivative securities, Wong retains a substantial equity stake in the company. As of the September 16, 2026 market close, the market value of the common stock holdings alone was ~$165.6 million at a share price of $157.60.Company OverviewMetricValueShare Price (as of market close 2026-09-16)$157.60Market Capitalization$31.0 billionRevenue (TTM)$2.8 billionNet Income (TTM)$871.1 millionCompany SnapshotReddit operates a user-generated content platform that produces revenue primarily through advertising, premium subscription services, and API licensing to enterprise partners seeking access to community-driven data and discussions.The company's business model centers on aggregating diverse online communities organized by shared interests, where users contribute content and engage in discussions, creating valuable engagement metrics that attract advertisers and support premium monetization offerings.Reddit's primary customers include digital advertisers seeking access to highly engaged, niche audience segments, premium subscribers valuing ad-free experiences and exclusive features, and enterprise clients licensing data and API access for research and business intelligence purposes.Reddit maintains a dominant position as one of the internet's largest community-driven platforms, with a user base generating substantial engagement across millions of specialized communities. The company has demonstrated strong financial performance with TTM revenue of $2.8 billion, reflecting successful monetization of its advertising and subscription offerings.
Reddit's competitive advantages include its unique user-generated content model, highly engaged and loyal user communities, and valuable proprietary data derived from authentic user discussions and behavior patterns.
What this transaction means for investorsCOO Jennifer Wong's September 14 sale of Reddit stock at a weighted average price of $162.33 occurred as shares were down substantially from a 52-week high of $282.95. However, investors can't read too much into this transaction, since it was executed as part of a pre-established Rule 10b5-1 plan rather than a market-timed investment decision.
Moreover, Wong's post-disposal equity position remains significant with over one million directly held shares. This ensures her continued alignment with shareholder interests.
Reddit's stock has declined in 2026 compared to 2025 as a result of its sky-high valuation combined with a lack of catalysts to buoy the share price. Its forward earnings multiple was nearly 70 at the end of last year, so the stock was poised for a correction.
That said, the company is doing well. In the second quarter, daily active users climbed 18% year over year to 130.3 million. This helped it achieve $804.9 million in Q2 sales, which represents the eighth consecutive quarter of more than 60% year-over-year revenue growth.
Robert Izquierdo has positions in Reddit. The Motley Fool has positions in and recommends Reddit. The Motley Fool has a disclosure policy.
The tech industry has been "tone deaf" in explaining AI and properly informing the public about real risks, Reddit co-founder Alexis Ohanian told CNBC on Wednesday.
Ohanian said the debate around AI should focus on substantive risks rather than issues that can be used to score political points, arguing that an informed public is essential to navigating the technology. He acknowledged that the tech industry has contributed to the problem by doing a "pretty tone deaf job" of explaining AI, while suggesting that its risks are more mundane than the "Terminator and Skynet" scenarios some fear.
Skynet is a fictional self-aware AI system in the "Terminator" movies that saw humans as a threat and sought to wipe them out.
The comments come days after warnings from researchers at AI labs OpenAI and Anthropic of the rapid advancement of the technology known as recursive self-improvement, or RSI.
RSI refers to AI systems helping develop more advanced models, potentially creating a cycle in which increasingly capable systems contribute to building even more capable ones.
The concern is that if AI systems take over the process of training new models, their human developers could eventually lose control over how those systems evolve.
Ohanian argued that while AI risks are real, apocalyptic "Terminator"-style warnings can distract from real concerns such as agent swarms, when multiple AI agents work together to perform a complicated task.
"There are risks, I do think they're more benign, or they're more banal than people are thinking," he said.
He compared AI to nuclear energy because both technologies are powerful scientific advances that can cause serious harm but also deliver major benefits if managed responsibly.
"I'm hopeful this goes in a healthy direction, and it's just going to require fewer tweets and more, like, thoughtful conversation," Ohanian said.
"The doomer tweet was discouraging," he said without specifying, adding it was "frustrating" when "the slogans are actually not real things."
Earlier this month, an AI researcher quit his job at Anthropic and accused the company and OpenAI of acting irresponsibly when it comes to developing the powerful technology.
Jacob Coxon, who has worked as a researcher at both companies, said on social media that he resigned because he was concerned that Anthropic and OpenAI are "gambling with our lives." He said the people building AI "earnestly believe that it could kill us all by the end of the decade."
For Ohanian, nuance is crucial. "We should have a discussion about the important, like real stuff, instead of these things that maybe score some quick political points… I have faith that we can have this discussion."
"It frustrates me because I see all this misinformation flying around, but I do think in the long run, we [will] get it right, and that's what I'm hoping happens. So I'm not terribly worried about that part of it."
Reddit Inc. (RDDT - Free Report) closed at $162.38 in the latest trading session, marking a +2.92% move from the prior day. The stock outperformed the S&P 500, which registered a daily loss of 0.48%. At the same time, the Dow lost 0.29%, and the tech-heavy Nasdaq lost 0.56%.
The company's stock has dropped by 11.41% in the past month, falling short of the Computer and Technology sector's gain of 1.49% and the S&P 500's loss of 0.82%.
The investment community will be paying close attention to the earnings performance of Reddit Inc. in its upcoming release. It is anticipated that the company will report an EPS of $1.33, marking a 66.25% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $886.87 million, up 51.62% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $5.27 per share and revenue of $3.39 billion, indicating changes of +101.15% and +54.05%, respectively, compared to the previous year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Reddit Inc. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.97% higher within the past month. Reddit Inc. presently features a Zacks Rank of #3 (Hold).
In terms of valuation, Reddit Inc. is currently trading at a Forward P/E ratio of 29.92. This signifies a premium in comparison to the average Forward P/E of 19.75 for its industry.
Also, we should mention that RDDT has a PEG ratio of 0.73. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Internet - Software stocks are, on average, holding a PEG ratio of 1.09 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 85, positioning it in the top 35% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
Reddit Inc. (NYSE:RDDT) shares are extending Thursday’s rally into Friday’s session, building on gains sparked by comments from CEO Steve Huffman at a major technology investor conference.
Reddit shares are trending higher. Why is RDDT stock advancing? Huffman’s Conference Remarks Sparked Thursday’s RallyReddit stock took off Thursday during a session when Huffman sat down for a discussion at Goldman Sachs’ Communacopia + Technology Conference, a move that stood out against a broader market pullback that saw the Nasdaq lose 0.82% and the S&P 500 slip 0.50% that same day.
Speaking to attendees, Huffman said the company’s marching orders for roughly the next year and a half boil down to two things: bringing in more users and getting a better handle on keeping newcomers around once they sign up.
The Reddit chief also shared some fresh numbers on how people are using the platform, saying app installs that can’t be tied back to a specific marketing source now run into the hundreds of thousands every day. He added that over the prior quarter, Reddit users had cranked out a billion new posts and comments combined, a figure that alone represents roughly 4% of everything that has ever been published on the site.
Reddit’s Chart Shows a Stock Still Working Through RepairThat momentum is showing up on the chart too, though the bigger picture remains shaky. Shares have lost nearly 40% of their value over the trailing 12 months, and even though the stock currently sits a bit above its 20-day average near $155, it’s still lagging noticeably behind both its 50-day marker around $168 and its 200-day line closer to $174, evidence that the longer-term downtrend hasn’t been resolved.
Looking at the broader trend picture, sellers still appear to hold the upper hand, given that the 20-day average sits under the 50-day, and a death cross dating back to March, when the 50-day average dropped beneath the 200-day, remains a drag that has kept bounces from morphing into anything more durable. Momentum readings paint a calmer picture in the near term, though, with RSI parked at 49.91, right in neutral territory, a sign that neither buyers nor sellers currently have real control of the tape.
Looking ahead, $162.50 stands out as the level bulls need to clear, sitting just under the 50-day average where earlier rally attempts have fizzled, while $143.50 marks the support zone worth watching on the downside, positioned well above the stock’s 52-week low near $119.27.
RDDT Shares Are Edging UpRDDT Price Action: Reddit shares were up 0.19% at $155.64 at the time of publication on Friday, according to Benzinga Pro.
Americkým akciím se počtvrté za sebou nevedlo. Špatná nálada plyne z růstu cen ropy a dalších inflačních tlaků, které vytvářejí významný prostor pro brzký růst sazeb FEDu. Pokračující nejistota v Hormuzském průlivu a očekávané americké midterms vzývají investory k vyčkávání a zavírání zisků.
Index Dow Jones -0,6 % na 52064,1 b.
S&P 500 -0,58 % na 7591,75 b.
Nasdaq Composite -0,65 % na 26081,72 b.
Index S&P 500 -0,58 % na 7591,75 b. Nejsilnij1í sektory S&P Zmina Nejslab1í sektory S&P Zmina Komunikaení slu 3/4 by +0,3 % Základní materiály -1,5 % Nezbytná spotoeba +0,2 % Utility -1 % Finanení sektor -0,3 % Informaení technologie -0,9 % Nejsilnij1í akcie S&P Zmina Nejslab1í akcie S&P Zmina Skyworks Solutions (SWKS) +9,8 % Cooper Cos (COO) -15 % Reddit (RDDT) +6,1 % Baker Hughes (BKR) -6,7 % Charter Communications (CHTR) +5,0 % Freeport-McMoRan (FCX) -6,6 % Elevance Health (ELV) +5,0 % Hewlett Packard Enterprise (HPE) -6,2 % Apple (AAPL) +3,6 % FactSet Research Systems (FDS) -5,8 %
Martin Varecha
Fio banka, a.s.
Prohlášení
Shares of Reddit Inc. RDDT rose more than 6% on Thursday, snapping a four-session losing streak after Piper Sandler data showed a sharp acceleration in user growth in August.
The brokerage said Reddit’s average users increased 8% month over month in August, marking the strongest monthly increase so far this year.
That followed a 2% decline in July, with growth in Reddit’s Feed audience more than offsetting a decline in Conversation users.
Piper Sandler’s analysis of Reddit Ads Manager data showed total audience growth accelerating to 18% year over year in August, compared with 12.8% in July.
International users were a key driver of the improvement.
According to Piper Sandler, international audience growth accelerated to 29.3% year over year in August from 19% in July.
US users increased 5.2%, although growth in the domestic market continued to lag the international segment.
Piper also said weekly user momentum had remained strong since early July, driven largely by the International Feed.
The brokerage attributed much of the August increase to Feed users, which added 79 million users, while Conversation users declined by 1 million.
The latest third-party estimates also come against the backdrop of Reddit’s reported second-quarter user growth.
Reddit said international daily active uniques rose 28% year over year to 77.1 million in the second quarter, while US daily active uniques increased 6% to 53.2 million.
Global daily active uniques rose 18% to 130.3 million.
Reddit’s weekly active uniques also surpassed 500 million in the second quarter, rising 24% year over year to 514.6 million.
The user growth data could be relevant for Reddit’s advertising business as the platform continues to expand its audience.
Piper Sandler said August ad spending across its digital advertising dataset was 60 basis points above expectations.
Netflix, Roku, YouTube and Pinterest were among the companies that posted the largest positive surprises in the brokerage’s dataset.
Piper also raised its estimate for third-quarter advertising spending growth by 30 basis points.
Its estimate for Reddit’s own third-quarter ad-spending growth was also increased by 30 basis points.
Reddit’s second-quarter financial results provide further context for the advertising opportunity.
Revenue increased 61% year over year to $805 million, while international revenue climbed 84% to $167 million.
The stronger international user growth could therefore be important as Reddit expands monetization beyond the US market.
Despite the positive user trends, Piper Sandler warned that changes to Reddit’s Ads Manager forecasting model are expected to reduce September audience-size estimates by about 20%.
The brokerage said the one-time reset reflects changes to the methodology rather than a deterioration in Reddit’s underlying user trends.
The changes affect forecasting and are not expected to alter auctions, optimization or ad delivery.
Piper’s August audience figures are third-party estimates and are not directly comparable with Reddit’s quarterly daily active unique metric.
Still, Thursday’s share move suggests investors were encouraged by the acceleration in audience growth, particularly internationally.
The data also provide a positive signal for Reddit’s advertising opportunity, although the upcoming reset in reported audience estimates could complicate comparisons in the near term.
Americké akciové trhy dnes pokračují v poklesech posledních dnů, když další růst cen ropy a čerstvá inflační data posílily obavy z brzkého zvýšení sazeb Fedu. S&P 500 ztrácí zhruba 0,4 % a míří ke čtvrtému poklesu v řadě, Nasdaq 100 odepisuje 0,3 %, Dow Jones klesá o 0,5 % a MSCI World ztrácí 0,5 %. Hlavním kurzotvorným faktorem je opět energie: Brent se během dne dotkl 107 USD za barel a WTI roste o více než 5 % nad 101 USD, zatímco americké dieselové futures vystoupaly poprvé od roku 2022 nad 5 USD za galon. Srpnový index cen výrobců v USA vzrostl meziměsíčně o 0,4 %, nejvíce od května, což podle trhu zvyšuje pravděpodobnost, že Fed na zasedání 15.–16. září přistoupí ke zvýšení sazeb. Investoři nyní čekají na páteční data o spotřebitelské inflaci, která mají ukázat, zda se vyšší ceny energií výrazněji propisují i do CPI.
Slabost akcií doprovází výprodej dluhopisů. Výnos desetiletého amerického dluhopisu roste o 7 bazických bodů na 4,91 %, dvouletý výnos podle zdrojů přidal 11 bodů a třicetiletý výnos se dostal na nejvyšší úroveň od roku 2007. Růst výnosů nejvíce zatěžuje akcie s vyššími valuacemi, zejména růstové tituly, protože trh nově zaceňuje zhruba 70% pravděpodobnost zvýšení sazeb Fedu už příští týden a plně započítává hike do října. Euro oslabuje o 0,1 % na 1,1619 USD, když dnešní zvýšení sazeb ECB bylo široce anticipováno. Z komodit vedle ropy oslabuje zlato o 0,8 % na 4 362 USD za unci. Kryptoměny rovněž ztrácejí, bitcoin odepisuje 1,5 % na 77 108 USD a ether klesá o 1 % na 2 447 USD.
Z jednotlivých titulů zaujal zejména Apple (AAPL +3,21 %) , který roste po převážně pozitivních komentářích analytiků k novému skládacímu iPhonu. Meta Platforms (META -0,6 %) se pohybuje kolem nuly po zvýšení doporučení od JPMorgan. Naopak Adobe (ADBE -2,12 %) klesá před výsledky po dnešním závěru trhu, protože část investorů nadále vnímá u softwarových firem riziko spojené s AI konkurencí. Macy’s (M -4,14 %) oslabuje i když firma překonala odhady za druhý kvartál a zvýšila výhled. Investory zklamala méně přesvědčivá prognóza pro třetí čtvrtletí. JetBlue Airways (JBLU +0,8 %) snížily výhled kapacity kvůli počasí a problémům v řízení letového provozu na severovýchodě USA a American Eagle (AEO -14,4 %) zaostal v meziročním srovnání celkových srovnatelných tržeb za odhady. Pod tlakem jsou také měďařské akcie, když Bílý dům podle zdrojů posuzuje cla na rafinovanou měď, takže výrazně klesá třeba Freeport-McMoRan (FCX -7,17 %). Po závěru trhu bude důležitý Oracle (ORCL -3,42 %), jehož výsledky otestují ochotu investorů tolerovat vysoké zadlužení a masivní výdaje na AI infrastrukturu.
Index Dow Jones -0,56 % na 52089,62 b.
S&P 500 -0,42 % na 7604,12 b.
Nasdaq Composite -0,38 % na 26154,32 b.
Index S&P 500 -0,42 % na 7604,12 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Nezbytná spotřeba +0,4 % Základní materiály -1,6 % Komunikační služby +0,3 % Utility -0,9 % Energie +0 % Průmysl -0,7 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Skyworks Solutions (SWKS) +9,1 % Cooper Cos (COO) -15 % Reddit (RDDT) +7,1 % Freeport-McMoRan (FCX) -7,1 % Elevance Health (ELV) +5,5 % Baker Hughes (BKR) -6,5 % GoDaddy (GDDY) +4,4 % Vertiv Holdings (VRT) -5,8 % Charter Communications (CHTR) +4,4 % Hewlett Packard Enterprise (HPE) -5,3 %
Martin Varecha
Fio banka, a.s.
Prohlášení
Reddit Inc. (RDDT - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Shares of this company have returned -4.6% over the past month versus the Zacks S&P 500 composite's -1.4% change. The Zacks Internet - Software industry, to which Reddit Inc. belongs, has gained 3.7% over this period. Now the key question is: Where could the stock be headed in the near term?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Reddit Inc. is expected to post earnings of $1.33 per share, indicating a change of +66.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.8% over the last 30 days.
The consensus earnings estimate of $5.27 for the current fiscal year indicates a year-over-year change of +101.2%. This estimate has changed +1% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $6.94 indicates a change of +31.6% from what Reddit Inc. is expected to report a year ago. Over the past month, the estimate has changed +0.7%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Reddit Inc..
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
In the case of Reddit Inc., the consensus sales estimate of $886.87 million for the current quarter points to a year-over-year change of +51.6%. The $3.39 billion and $4.49 billion estimates for the current and next fiscal years indicate changes of +54.1% and +32.2%, respectively.
Last Reported Results and Surprise HistoryReddit Inc. reported revenues of $804.91 million in the last reported quarter, representing a year-over-year change of +61.1%. EPS of $1.25 for the same period compares with $0.45 a year ago.
Compared to the Zacks Consensus Estimate of $743.93 million, the reported revenues represent a surprise of +8.2%. The EPS surprise was +26.26%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Reddit Inc. is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Reddit Inc.. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
Fresh third-party data on Reddit's user momentum sent shares surging against a down market, but a looming audience measurement reset threatens to scramble the very numbers investors are celebrating today.
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Reddit (NYSE:RDDT | RDDT Price Prediction) stock is up 6% to $155.43 in mid-morning Thursday trading, leading the pure-play social names higher on fresh third-party research showing user growth accelerated to the fastest monthly pace of the year in August. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is down 0.4% on the day, so the move stands out against a broadly softer market. Coming into today, Reddit stock was down 33% year to date (YTD), so this pop lands after a punishing stretch that leaves the analyst average price target of $213.10 well above where the stock trades.
Today’s catalyst is a Piper Sandler note tracking Reddit’s audience trends outside the firm’s own disclosures, and it lands one day after prior coverage of this group focused on Pinterest‘s (NYSE:PINS) guidance-driven repricing and the resignation of its finance chief. That piece raised the question of whether Reddit and Snap (NYSE:SNAP) were about to be dragged into a sector-wide advertising reset alongside Pinterest, and today’s session resolves that question in the negative, with the pure-play social sleeve moving up as one.
User Growth Note Sparks the Rally Piper Sandler said Reddit’s average user base grew 8% month on month in August, the platform’s fastest monthly growth rate of the year and a reversal from a decline the prior month. The same Piper Sandler note put overall audience up 18% year on year in August, accelerating from 12.8% growth in July. International users carried much of the load in the Piper Sandler data, growing 29.3% year on year versus 19% in July, so the reacceleration is being led by markets outside the home base.
This framing matters because Reddit management publicly targets 1 billion daily users globally and 100 million in the U.S. Reddit’s Q2 2026 report in July already showed advertising revenue of $762 million on 64% year-over-year growth, so today’s third-party read reinforces that the top of the funnel is cooperating with the ad engine underneath.
There’s a caveat worth flagging. Separately, Piper Sandler said Reddit is preparing changes to its ads manager model that are expected to produce a 20% reset to reported audience size. So the growth investors are rewarding today sits on a measurement basis that’s about to change, and the next quarterly disclosure will be the first chance to see whether the underlying trajectory survives the new denominator.
Peers Follow, Fund Fades Wednesday’s open question about a sector-wide social ad reset gets answered in the negative today. Pinterest stock is up 2% to $18.67, recovering some ground after its own guidance-driven repricing earlier this week. Meanwhile, Snap stock is up 0.5% to $5.34, a slim gain that still keeps it aligned with the group.
The Global X Social Media ETF (NASDAQ:SOCL) is nevertheless down 0.2% on the day. That divergence reflects sleeve weight rather than any change in sentiment on the three pure-play names below, since SOCL’s construction leans heavily on the largest digital ad companies.
Meta Platforms (NASDAQ:META) sits at the top of the fund at 10.6% of net assets; Alphabet (NASDAQ:GOOGL) is the next-largest position at 9%. Together they anchor the SOCL ETF, so the fund is reading the megacap ad platforms rather than the smaller pure-plays rallying underneath it today.
What to Watch Next Two threads carry the story forward from here. The ads manager audience reset that Piper Sandler flagged will re-baseline reported user counts on the same platform investors are rewarding today for user growth, and the optics of that shift could complicate the next quarterly disclosure. Position sizing on Reddit stock should account for the fact that the numbers underpinning today’s move are about to be measured on a different basis, which argues for building their exposure gradually rather than chasing a single-session pop.
Whether Pinterest and Snap hold their bounces into the close is the more immediate cue for the group, since a group-wide follow-through would confirm that Wednesday’s Pinterest selloff was name-specific rather than a warning shot for social advertising. The SOCL ETF’s exposure to Meta Platforms and Alphabet remains the tell for whether mega-cap ad spend picks up alongside the smaller platforms. Investors considering exposure to this group can look for signs that Reddit’s international momentum shows up in the next reported quarter rather than only in third-party trackers.
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California State Teachers Retirement System boosted its stake in shares of Reddit Inc. (NYSE:RDDT – Free Report) by 19,702.8% in the 2nd quarter, according to its most recent disclosure with the SEC. The institutional investor owned 30,076,727 shares of the company’s stock after acquiring an additional 29,924,846 shares during the period. California State Teachers Retirement System owned 15.63% of Reddit worth $5,220,718,000 at the end of the most recent quarter.
A number of other institutional investors and hedge funds also recently bought and sold shares of the stock. NewEdge Advisors LLC grew its position in shares of Reddit by 143.3% during the first quarter. NewEdge Advisors LLC now owns 7,982 shares of the company’s stock valued at $837,000 after purchasing an additional 4,701 shares in the last quarter. Empowered Funds LLC bought a new position in Reddit during the first quarter valued at approximately $213,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its stake in Reddit by 106.3% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 216,960 shares of the company’s stock valued at $22,759,000 after buying an additional 111,780 shares during the last quarter. Focus Partners Wealth grew its holdings in Reddit by 40.8% during the 1st quarter. Focus Partners Wealth now owns 10,224 shares of the company’s stock valued at $1,073,000 after buying an additional 2,965 shares in the last quarter. Finally, Geneos Wealth Management Inc. increased its stake in Reddit by 344.6% in the 1st quarter. Geneos Wealth Management Inc. now owns 369 shares of the company’s stock worth $39,000 after acquiring an additional 286 shares during the last quarter.
Wall Street Analysts Forecast Growth RDDT has been the topic of several recent research reports. DA Davidson reaffirmed a “buy” rating and set a $200.00 price objective on shares of Reddit in a report on Thursday, July 23rd. Evercore restated an “outperform” rating and issued a $265.00 price target on shares of Reddit in a research report on Friday, July 31st. Oppenheimer decreased their price target on shares of Reddit from $225.00 to $200.00 and set an “outperform” rating on the stock in a research note on Friday, July 31st. Robert W. Baird set a $185.00 price objective on shares of Reddit in a research report on Friday, July 31st. Finally, Citigroup reissued a “market outperform” rating on shares of Reddit in a research note on Monday, August 24th. Two analysts have rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and eleven have assigned a Hold rating to the company’s stock. Based on data from MarketBeat, the stock has a consensus rating of “Moderate Buy” and an average target price of $221.10.
Check Out Our Latest Analysis on RDDT Reddit Stock Performance NYSE RDDT opened at $146.80 on Thursday. The business’s 50 day moving average price is $168.67 and its 200-day moving average price is $159.06. Reddit Inc. has a fifty-two week low of $119.27 and a fifty-two week high of $282.95. The company has a market cap of $28.25 billion, a P/E ratio of 34.14, a P/E/G ratio of 0.69 and a beta of 2.02.
Reddit (NYSE:RDDT – Get Free Report) last issued its quarterly earnings results on Thursday, July 30th. The company reported $1.25 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.95 by $0.30. The company had revenue of $804.91 million during the quarter, compared to the consensus estimate of $731.00 million. Reddit had a return on equity of 29.02% and a net margin of 31.35%.Reddit’s revenue was up 61.0% on a year-over-year basis. During the same period last year, the company earned $0.45 earnings per share. As a group, equities analysts predict that Reddit Inc. will post 5.27 EPS for the current year.
Insider Activity In other news, COO Jennifer Wong sold 75,000 shares of the firm’s stock in a transaction dated Friday, August 14th. The shares were sold at an average price of $178.55, for a total value of $13,391,250.00. Following the completion of the sale, the chief operating officer owned 1,050,339 shares in the company, valued at approximately $187,538,028.45. This trade represents a 6.66% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Robert Sauerberg sold 5,128 shares of the stock in a transaction dated Tuesday, August 25th. The stock was sold at an average price of $159.92, for a total transaction of $820,069.76. Following the completion of the sale, the director directly owned 27,087 shares in the company, valued at $4,331,753.04. This trade represents a 15.92% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 210,102 shares of company stock worth $36,375,252 over the last 90 days. Insiders own 28.48% of the company’s stock.
Reddit Company Profile (Free Report)
Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and discussions. Users can submit posts, links, images and videos, while community members can comment, vote and interact through publicly accessible forums known as subreddits.
The company generates revenue primarily through digital advertising and also offers premium memberships and other paid products. Reddit additionally provides data licensing and developer-related services that support the use of its platform content and technology.
Founded in 2005 by Steve Huffman, Alexis Ohanian and Aaron Swartz, Reddit serves users worldwide across a broad range of communities.
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Key Takeaways Reddit's Q2 revenues surged 61% to $805 million, while ad revenues climbed 64% to $762 million. Reddit Max adoption rose over 60% sequentially as revenues from Max campaigns jumped more than 150%. Max tests delivered 17% lower acquisition costs and more than 27% higher conversions for advertisers. Reddit (RDDT - Free Report) is benefiting from accelerating AI and machine-learning investments across its advertising, search and consumer platforms, which are improving engagement and strengthening monetization. In the second quarter of 2026, revenues surged 61% year over year to $805 million, while advertising revenues increased 64% to $762 million. Active advertisers grew more than 70%, highlighting growing demand for Reddit’s high-intent audiences.
Reddit Max is emerging as a key AI-driven growth catalyst. The launch and rapid adoption of Reddit Max, an AI-driven suite for ad automation and optimization, has delivered significant results. Advertiser adoption of Max increased by more than 60% sequentially in the second quarter, and revenues from Max campaigns increased by more than 150%. Features like tailored creatives and dynamic product ads are helping brands achieve better outcomes, such as Lenovo’s 40% higher purchase value with Max campaigns compared to standard campaigns.
The company’s expanding AI portfolio has been noteworthy. Reddit recently made its AI-powered Max campaigns available to all advertisers, expanding access after an earlier beta launch. Max campaigns automate targeting, creative selection, placements and budget allocation while allowing advertisers to maintain strategic control. Early testing showed 17% lower cost per acquisition and more than 27% higher conversions. Reddit also added Advertising API support, integration with Smartly and new asset groups that let advertisers organize and measure different creative sets within one campaign. Powered by AI-based impression-value predictions, Max campaigns are designed to improve traffic, conversions and advertising efficiency across Reddit’s platform.
These initiatives suggest that continued AI innovation could make each advertising impression more valuable, broaden advertiser adoption and deepen user engagement. Reddit expects third-quarter 2026 revenues of $860-$870 million, indicating that its expanding AI-powered monetization engine should remain an important driver of top-line growth.
How Competitors Fare Against RDDTDespite Reddit’s expanding portfolio, the company faces stiff competition from Meta Platforms (META - Free Report) and Snap (SNAP - Free Report) . Both Meta Platforms and Snap are also expanding their footprint in the rapidly growing digital ad market.
Meta Platforms is extending AI deeper across its apps, and recommendation and ad-system upgrades are supporting engagement and advertiser returns. WhatsApp, subscriptions, business agents and AI glasses broaden the long-term monetization runway beyond feed advertising and add new enterprise avenues.
Snap’s flagship product, Snapchat, reached 971 million monthly active users and 493 million daily active users in the second quarter of 2026, driven by continued adoption of Augmented Reality Lenses, Spotlight and AI-powered features. Key growth drivers include its AI-powered Smart Campaign Solutions, AI Sponsored Snaps, Sponsored Snaps and Dynamic Product Ads.
RDDT’s Share Price Performance, Valuation and EstimatesRDDT shares have plunged 35% year to date, underperforming the broader Zacks Computer & Technology sector’s 18.2% appreciation and the Internet - Software industry’s 0.2% decline.
RDDT Stock Performance
Image Source: Zacks Investment Research
RDDT shares are overvalued, with a forward 12-month Price/Sales of 6.93X compared with the Computer & Technology sector’s 6.09X. RDDT has a Value Score of D.
RDDT Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings is pegged at $5.27 per share, which has increased 0.95% over the past 30 days. This suggests 101.15% year-over-year growth.
RDDT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
