Investors Buy Large Volume of Reddit Call Options (NYSE:RDDT)

Key Points

• Investors bought an unusually large volume of calls—80,316 call options, about +88% versus typical daily call volume—indicating speculative bullish positioning in RDDT.
• Reddit delivered a strong quarter, reporting EPS $1.01 vs. $0.62 est. and revenue of $663M (up ~69% YoY), and offered Q2 revenue guidance above Street expectations as AI‑driven ad products and higher search usage bolster monetization.
• Despite executive sales (CTO and COO sold sizable stakes) and net insider selling over the quarter, analysts overall hold a "Moderate Buy" consensus with a mean target of $228.61, reflecting mixed but generally positive sentiment.

Reddit Inc. (NYSE:RDDT - Get Free Report) was the recipient of unusually large options trading activity on Friday. Investors acquired 80,316 call options on the stock. This is an increase of approximately 88% compared to the typical volume of 42,835 call options.

Analyst Upgrades and Downgrades

A number of equities research analysts recently commented on the stock. Citizens Jmp decreased their target price on shares of Reddit from $250.00 to $240.00 and set a "market outperform" rating for the company in a research report on Friday. Robert W. Baird set a $200.00 price target on shares of Reddit in a research note on Friday, February 6th. Morgan Stanley set a $240.00 price objective on shares of Reddit in a research note on Friday, February 6th. DA Davidson reissued a "buy" rating and set a $200.00 price target on shares of Reddit in a report on Friday. Finally, Cantor Fitzgerald increased their price target on shares of Reddit from $170.00 to $180.00 and gave the stock a "neutral" rating in a report on Friday. One analyst has rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and eleven have issued 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 $228.61.

Insider Buying and Selling at Reddit

In other news, CTO Christopher Brian Slowe sold 15,500 shares of the company's stock in a transaction that occurred on Wednesday, April 8th. The shares were sold at an average price of $150.67, for a total value of $2,335,385.00. Following the completion of the sale, the chief technology officer owned 38,413 shares of the company's stock, valued at approximately $5,787,686.71. This represents a 28.75% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible 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 company's stock in a transaction that occurred on Thursday, April 16th. The stock was sold at an average price of $161.47, for a total transaction of $6,324,295.49. Following the completion of the sale, the chief operating officer directly owned 1,088,451 shares of the company's stock, valued at $175,752,182.97. The trade was 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 quarter, insiders bought 61,000 shares of company stock worth $8,870,815 and sold 280,441 shares worth $40,873,759. Company insiders own 34.25% of the company's stock.

Institutional Investors Weigh In On Reddit

Several hedge funds and other institutional investors have recently bought and sold shares of RDDT. NewEdge Advisors LLC increased its position in Reddit by 143.3% during the first quarter. NewEdge Advisors LLC now owns 7,982 shares of the company's stock worth $837,000 after purchasing an additional 4,701 shares during the last quarter. Empowered Funds LLC acquired a new stake in Reddit during the first quarter worth about $213,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC increased its position 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 worth $22,759,000 after purchasing an additional 111,780 shares during the last quarter. Focus Partners Wealth increased its position in Reddit by 40.8% during the first quarter. Focus Partners Wealth now owns 10,224 shares of the company's stock worth $1,073,000 after purchasing an additional 2,965 shares during the last quarter. Finally, Geneos Wealth Management Inc. increased its position in Reddit by 344.6% during the first quarter. Geneos Wealth Management Inc. now owns 369 shares of the company's stock worth $39,000 after purchasing an additional 286 shares during the last quarter.

Key Headlines Impacting Reddit

Here are the key news stories impacting Reddit this week:

• Positive Sentiment: Q1 earnings and revenue beat — Reddit reported EPS of $1.01 (vs. ~$0.62 est.) and revenue of about $663M, a ~69% year‑over‑year jump; ad revenue rose sharply, underscoring improving monetization. Zacks: Reddit Q1 Earnings Beat
• Positive Sentiment: Upbeat near-term guidance — management gave Q2 revenue guidance (~$715M–$725M) above Street expectations, signaling continued ad demand momentum. Reuters: Reddit expects revenue above estimates
• Positive Sentiment: AI-driven ad products & search improvements gaining traction — exec commentary and coverage point to rising advertiser adoption of lower‑funnel, AI-enhanced ad tools and a ~30% YoY increase in weekly search usage, both supporting higher yield per user. Reuters: AI-driven ad growth fuels outlook TechCrunch: People are finally using Reddit's search
• Positive Sentiment: Analyst support — several firms reaffirmed or raised targets (e.g., Piper Sandler raised its PT to $215; Needham reaffirmed buy with $300 PT; DA Davidson reaffirmed buy at $200), adding buy‑side validation. TickerReport / coverage on Piper Sandler
• Neutral Sentiment: Unusual options activity — traders purchased ~80,316 call options (about +88% vs. typical daily call volume), indicating speculative bullish positioning but not guaranteeing directional follow‑through.
• Neutral Sentiment: Cantor Fitzgerald raised its price target (to $180) but left a neutral rating — a mixed signal: higher target but not a bullish rating change. Benzinga: Cantor Fitzgerald update
• Negative Sentiment: Some analyst conflict and target trimming — Citizens Jmp reduced its target from $250 to $240 (still bullish stance), reflecting differing views on longer‑term upside and leaving room for skepticism about sustainability. Benzinga: Citizens Jmp update

Reddit Stock Performance

Shares of NYSE:RDDT traded up $19.30 during midday trading on Friday, hitting $166.53. The company's stock had a trading volume of 14,213,044 shares, compared to its average volume of 5,296,806. The business's 50 day simple moving average is $144.12 and its 200 day simple moving average is $184.31. The company has a market cap of $31.81 billion, a P/E ratio of 63.56, a price-to-earnings-growth ratio of 1.07 and a beta of 2.40. Reddit has a 12-month low of $94.89 and a 12-month high of $282.95.

Reddit (NYSE:RDDT - Get Free Report) last released its quarterly earnings data on Thursday, April 30th. The company reported $1.01 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.62 by $0.39. Reddit had a net margin of 24.05% and a return on equity of 20.89%. The firm had revenue of $663.41 million during the quarter, compared to analysts' expectations of $607.74 million. During the same period last year, the business earned $0.13 earnings per share. Reddit's revenue was up 69.1% compared to the same quarter last year. On average, sell-side analysts predict that Reddit will post 4.02 earnings per share for the current fiscal year.

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.

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