Pacer Advisors Inc. Sells 231,860 Shares of Reddit Inc. $RDDT

Key Points

• Pacer Advisors cut its Reddit stake by 72.9% in the first quarter, selling 231,860 shares and retaining 86,293 shares valued at approximately $11.6 million.
• Reddit reported strong quarterly results, with revenue up 61% year over year to $804.9 million and EPS of $1.25, exceeding analyst expectations. Analysts maintain a “Moderate Buy” consensus rating with an average price target of $220.90.
• Despite improving monetization and advertising growth, sluggish U.S. user growth, search-referral volatility and recent insider selling remain key risks for the stock.

Pacer Advisors Inc. trimmed its stake in shares of Reddit Inc. (NYSE:RDDT - Free Report) by 72.9% during the first quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The firm owned 86,293 shares of the company's stock after selling 231,860 shares during the period. Pacer Advisors Inc.'s holdings in Reddit were worth $11,619,000 as of its most recent SEC filing.

Several other institutional investors have also added to or reduced their stakes in the stock. Evansbrook LLC increased its holdings in Reddit by 2.2% during the 1st quarter. Evansbrook LLC now owns 2,736 shares of the company's stock worth $368,000 after purchasing an additional 59 shares in the last quarter. Institute for Wealth Management LLC. lifted its holdings in shares of Reddit by 6.1% in the fourth quarter. Institute for Wealth Management LLC. now owns 1,071 shares of the company's stock valued at $246,000 after purchasing an additional 62 shares in the last quarter. Florida Financial Advisors LLC lifted its holdings in shares of Reddit by 6.7% in the fourth quarter. Florida Financial Advisors LLC now owns 1,087 shares of the company's stock valued at $250,000 after purchasing an additional 68 shares in the last quarter. Diversified Trust Co boosted its position in shares of Reddit by 2.1% during the first quarter. Diversified Trust Co now owns 3,271 shares of the company's stock worth $440,000 after buying an additional 68 shares during the period. Finally, Yousif Capital Management LLC boosted its position in shares of Reddit by 5.1% during the fourth quarter. Yousif Capital Management LLC now owns 1,554 shares of the company's stock worth $350,000 after buying an additional 75 shares during the period.

Reddit Stock Performance

Shares of NYSE RDDT opened at $159.93 on Wednesday. The stock has a 50 day moving average price of $177.29 and a 200 day moving average price of $162.98. Reddit Inc. has a 52 week low of $119.27 and a 52 week high of $282.95. The stock has a market capitalization of $30.79 billion, a PE ratio of 37.19, a price-to-earnings-growth ratio of 0.54 and a beta of 2.04.

Reddit (NYSE:RDDT - Get Free Report) last posted its quarterly earnings results on Thursday, July 30th. The company reported $1.25 earnings per share for the quarter, beating 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 business's revenue was up 61.0% compared to the same quarter last year. During the same period last year, the company earned $0.45 earnings per share. As a group, research analysts forecast that Reddit Inc. will post 5.03 EPS for the current year.

Trending Headlines about Reddit

Here are the key news stories impacting Reddit this week:

• Positive Sentiment: Strong Q2 results and outlook support the rebound. Reddit reported revenue of $804.9 million, up 61% year over year, and EPS of $1.25, beating estimates of $731 million and $0.95, respectively. Advertising revenue rose 64%, while management’s Q3 revenue and adjusted EBITDA guidance of $860 million–$870 million and $385 million–$395 million exceeded consensus expectations. Reddit Q2 review
• Positive Sentiment: Improving monetization and cash flow are attracting buyers. Global daily active unique users reached 130.3 million, and Reddit generated more than $1 billion in trailing-12-month operating cash flow. Analysts highlighted a 24% increase in U.S. average revenue per user, suggesting stronger monetization can offset slower user growth. Reddit valuation and free cash flow analysis
• Positive Sentiment: Reddit continues advancing its digital advertising strategy. Coverage points to expanding advertising tools and stronger monetization of highly engaged users as potential long-term growth drivers. Reddit digital advertising strategy
• Neutral Sentiment: Analyst views remain broadly constructive but targets are mixed. Some firms lowered targets, including Cantor Fitzgerald to $170 and Wedbush to $221, while another analyst raised its target to $275. The differing estimates reflect strong fundamentals but uncertainty about user growth and search traffic. Cantor Fitzgerald target change Reddit price target increase
• Negative Sentiment: Flat U.S. logged-in user growth remains the principal concern. U.S. daily active users declined slightly quarter over quarter to 53.2 million, while logged-in users fell to 23.1 million from 23.2 million. Investors are questioning whether monetization gains can continue if engagement growth stagnates, particularly as Reddit stops separately reporting logged-in and logged-out users. Reddit U.S. user growth concerns
• Negative Sentiment: Search-referral volatility and legal scrutiny add risk. Investors remain concerned that changes in search traffic could reduce Reddit’s less-engaged audience. Separately, Bragar Eagel & Squire announced an investigation on behalf of long-term shareholders, which could create additional reputational and legal overhang, although no wrongdoing has been established. Reddit shareholder investigation

Analysts Set New Price Targets

A number of equities research analysts recently issued reports on RDDT shares. Robert W. Baird set a $185.00 target price on Reddit in a research report on Friday. The Goldman Sachs Group reaffirmed a "neutral" rating and set a $200.00 price target on shares of Reddit in a research report on Friday, May 1st. Deutsche Bank Aktiengesellschaft set a $200.00 price target on Reddit in a research report on Friday. Jefferies Financial Group set a $250.00 price objective on shares of Reddit in a report on Friday, July 10th. Finally, Piper Sandler reiterated an "overweight" rating and issued a $195.00 price objective (down from $215.00) on shares of Reddit in a report on Friday. Two investment analysts have rated the stock with a Strong Buy rating, nineteen have issued a Buy rating and eleven have issued a Hold rating to the company's stock. According to data from MarketBeat, Reddit has a consensus rating of "Moderate Buy" and a consensus price target of $220.90.

Insider Activity

In other Reddit news, CAO Michelle Marie Reynolds sold 808 shares of the company's stock in a transaction on Wednesday, July 1st. The shares were sold at an average price of $200.00, for a total transaction of $161,600.00. Following the sale, the chief accounting officer directly owned 15,060 shares of the company's stock, valued at approximately $3,012,000. This represents a 5.09% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Steve Ladd Huffman sold 18,000 shares of the company's stock in a transaction on Tuesday, June 30th. The stock was sold at an average price of $173.13, for a total transaction of $3,116,340.00. Following the sale, the chief executive officer directly owned 373,814 shares in the company, valued at $64,718,417.82. This trade represents a 4.59% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders sold 151,141 shares of company stock valued at $25,588,445. 28.48% of the stock is owned by insiders.

Reddit 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.

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).

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.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source