Cantor Fitzgerald Issues Pessimistic Forecast for Reddit (NYSE:RDDT) Stock Price

Key Points

• Cantor Fitzgerald cut Reddit’s price target from $200 to $170 and maintained a neutral rating, though the new target implies roughly 22% upside from the reported share price.
• Reddit’s shares fell to $138.98, while the broader analyst consensus remains more bullish, with a “Moderate Buy” rating and an average target of $227.03.
• Despite a strong quarterly earnings and revenue beat and above-consensus guidance, investor concerns about AI-driven changes to Google search potentially reducing Reddit’s referral traffic weighed on the stock.

Reddit (NYSE:RDDT - Get Free Report) had its price objective cut by Cantor Fitzgerald from $200.00 to $170.00 in a research report issued on Friday,Benzinga reports. The firm currently has a "neutral" rating on the stock. Cantor Fitzgerald's price objective indicates a potential upside of 22.32% from the company's current price.

A number of other equities research analysts have also recently weighed in on RDDT. Sanford C. Bernstein reaffirmed a "market perform" rating and set a $180.00 price target on shares of Reddit in a report on Friday. Weiss Ratings reissued a "hold (c)" rating on shares of Reddit in a research note on Friday, May 8th. Citizens Jmp decreased their target price on Reddit from $250.00 to $240.00 and set a "market outperform" rating on the stock in a report on Friday, May 1st. Oppenheimer restated an "outperform" rating and issued a $225.00 target price on shares of Reddit in a research note on Friday, May 1st. Finally, UBS Group reaffirmed a "buy" rating on shares of Reddit in a report on Friday. Two equities research analysts have rated the stock with a Strong Buy rating, twenty have assigned a Buy rating and eleven have given a Hold rating to the company's stock. According to data from MarketBeat.com, Reddit currently has a consensus rating of "Moderate Buy" and a consensus target price of $227.03.

Reddit Stock Performance

Shares of NYSE RDDT traded down $39.06 during mid-day trading on Friday, hitting $138.98. 9,879,146 shares of the stock were exchanged, compared to its average volume of 5,113,341. Reddit has a twelve month low of $119.27 and a twelve month high of $282.95. The stock's fifty day simple moving average is $176.74 and its two-hundred day simple moving average is $165.09. The company has a market cap of $26.76 billion, a P/E ratio of 39.62 and a beta of 1.93.

Reddit (NYSE:RDDT - Get Free Report) last announced its earnings results on Thursday, July 30th. The company reported $1.25 EPS for the quarter, topping the consensus estimate of $0.95 by $0.30. The business had revenue of $804.91 million for the quarter, compared to the consensus estimate of $731.00 million. Reddit had a return on equity of 25.48% and a net margin of 28.60%.Reddit's revenue was up 61.0% compared to the same quarter last year. During the same period in the previous year, the business earned $0.45 EPS. As a group, equities research analysts predict that Reddit will post 4.85 earnings per share for the current fiscal year.

Insider Buying and Selling at Reddit

In related news, CEO Steve Ladd Huffman sold 18,000 shares of the business's stock in a transaction that occurred on Monday, June 15th. The shares were sold at an average price of $178.26, for a total transaction of $3,208,680.00. Following the completion of the transaction, the chief executive officer owned 373,814 shares in the company, valued at approximately $66,636,083.64. The trade was a 4.59% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Jennifer L. Wong sold 39,167 shares of the business's stock in a transaction on Monday, May 18th. The shares were sold at an average price of $158.52, for a total transaction of $6,208,752.84. Following the completion of the transaction, the chief operating officer directly owned 1,088,451 shares of the company's stock, valued at $172,541,252.52. This trade represents a 3.47% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 169,141 shares of company stock valued at $28,680,845. 28.48% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Reddit

Several large investors have recently made changes to their positions in the stock. Vanguard Group Inc. boosted its position in Reddit by 8.9% during the 4th quarter. Vanguard Group Inc. now owns 13,322,048 shares of the company's stock worth $3,062,339,000 after acquiring an additional 1,083,540 shares during the last quarter. Capital World Investors acquired a new stake in shares of Reddit in the fourth quarter valued at approximately $1,293,258,000. State Street Corp lifted its position in shares of Reddit by 6.0% in the fourth quarter. State Street Corp now owns 2,631,332 shares of the company's stock worth $604,864,000 after purchasing an additional 149,401 shares in the last quarter. Geode Capital Management LLC lifted its position in shares of Reddit by 4.7% in the fourth quarter. Geode Capital Management LLC now owns 2,382,712 shares of the company's stock worth $546,789,000 after purchasing an additional 106,821 shares in the last quarter. Finally, Morgan Stanley lifted its position in shares of Reddit by 11.4% in the fourth quarter. Morgan Stanley now owns 2,372,443 shares of the company's stock worth $545,354,000 after purchasing an additional 242,709 shares in the last quarter.

Key Stories Impacting Reddit

Here are the key news stories impacting Reddit this week:

• Positive Sentiment: Q2 results beat expectations. Reddit reported adjusted EPS of $1.25, versus the $0.95–$0.99 analyst consensus, while revenue rose 61% year over year to $804.9 million, well above the roughly $731 million estimate. Net income reached $253 million, supported by continued user growth and higher advertising revenue. Reddit crushes revenue and earnings estimates, issues strong guidance
• Positive Sentiment: Third-quarter guidance exceeded Wall Street forecasts. Reddit projected revenue of $860 million to $870 million, above the $829.7 million consensus estimate. Management also said AI-powered advertising tools are helping attract marketers and support commercial momentum. Reddit expects revenue above estimates as AI tools attract advertisers
• Positive Sentiment: Analyst sentiment improved. KeyCorp upgraded Reddit to “strong buy,” reflecting confidence in the company’s growth and momentum. Reddit upgraded by KeyCorp
• Neutral Sentiment: Management defended Reddit’s search value. CEO Steve Huffman said Google’s AI Overviews have not yet replaced the value of traditional search links, but the company acknowledged that search-engine referrals have become “choppy.”
• Negative Sentiment: AI-related search disruption overshadowed the earnings beat. Investors are concerned that Google’s AI search features could reduce traffic referrals to Reddit and potentially weaken user growth, engagement, and advertising monetization. Reports also suggested Reddit could reconsider a Google partnership reportedly worth about $60 million annually if search traffic continues to deteriorate. Reddit’s strong quarter fails to lift shares as AI search concerns linger

Reddit Company Profile

Reddit is an online social news aggregation, discussion and content-sharing platform organized around user-created communities called "subreddits," each focused on a particular topic or interest. Registered users submit links, text posts, images and video, and community members vote and comment to surface popular content. The site is accessed via its web platform and mobile apps for iOS and Android, and it supports live events such as Ask Me Anything (AMA) sessions and community-driven discussions.

Founded in 2005 by Steve Huffman and Alexis Ohanian, Reddit is headquartered in San Francisco and serves a global audience with particularly large user bases in the United States and other English-speaking markets.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.