Reddit (NYSE:RDDT) Sets New 1-Year Low on Analyst Downgrade

Key Points

• Reddit shares fell to a new 52-week low, trading as low as $95.45 after B. Riley cut its price target from $270 to $190, despite maintaining a buy rating.
• Analyst sentiment remains mixed but leans positive, with a consensus “Moderate Buy” rating and an average price target of $207.52; several firms have recently lowered targets or adopted neutral ratings.
• Reddit reported strong third-quarter results, with revenue up 53% year over year to roughly $895 million and adjusted EPS of $1.40, but weaker guidance, slowing user growth and declining Google-driven traffic continue to weigh on the stock.

Reddit Inc. (NYSE:RDDT - Get Free Report)'s share price hit a new 52-week low on Friday after B. Riley Financial lowered their price target on the stock from $270.00 to $190.00. B. Riley Financial currently has a buy rating on the stock. Reddit traded as low as $95.45 and last traded at $98.2510, with a volume of 5,954,905 shares traded. The stock had previously closed at $129.60.

A number of other equities research analysts have also recently commented on RDDT. Telsey Advisory Group set a $240.00 target price on Reddit in a research report on Friday, July 31st. UBS Group reissued a "buy" rating on shares of Reddit in a report on Friday. BNP Paribas Exane assumed coverage on shares of Reddit in a research report on Friday, September 18th. They set a "neutral" rating and a $180.00 price target on the stock. Needham & Company LLC cut their target price on Reddit from $300.00 to $150.00 and set a "buy" rating for the company in a research note on Friday. Finally, JPMorgan Chase & Co. reduced their target price on shares of Reddit from $200.00 to $185.00 and set a "neutral" rating on the stock in a research note on Friday, July 31st. Two investment analysts have rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and thirteen have issued a Hold rating to the company. According to MarketBeat, the company presently has a consensus rating of "Moderate Buy" and a consensus price target of $207.52.

Insiders Place Their Bets

In related news, CEO Steve Huffman sold 17,308 shares of the firm's stock in a transaction dated Tuesday, October 13th. The stock was sold at an average price of $158.57, for a total transaction of $2,744,529.56. Following the completion of the sale, the chief executive officer directly owned 336,432 shares of the company's stock, valued at approximately $53,348,022.24. This trade represents a 4.89% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Robert A. Sauerberg sold 5,128 shares of the business's 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 trade represents a 15.92% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 306,052 shares of company stock valued at $49,754,523 over the last quarter. 28.48% of the stock is owned by insiders.

Reddit News Summary

Here are the key news stories impacting Reddit this week:

• Positive Sentiment: Reddit reported third-quarter adjusted earnings of $1.40 per share and revenue of approximately $895 million, exceeding analyst estimates of $1.33 and $875 million, respectively. Revenue increased 53% year over year, while earnings rose from $0.80 a year earlier. Reddit Inc. Q3 Earnings and Revenues Beat Estimates
• Positive Sentiment: The strong quarterly performance demonstrates continued monetization progress, particularly in advertising, and provides some support for Reddit’s long-term growth story. Reddit Reports Third Quarter 2026 Results
• Neutral Sentiment: Reddit said it may test a primarily logged-in experience to reduce data scraping and address declining referrals from Google search. The strategy could improve user registration and monetization over time, but it risks reducing traffic from casual and logged-out visitors in the near term. Reddit Posts Third-Quarter Earnings and Plans Login Requirement Test
• Negative Sentiment: Fourth-quarter guidance was weaker than expected, overshadowing the earnings and revenue beats. Investors are also concerned about slowing daily-user growth, declining Google search traffic, and the impact of AI-powered search on Reddit’s ability to attract visitors. Reddit Shares Tumble on Weak Guidance
• Negative Sentiment: Analysts responded by cutting their forecasts and price targets. Cantor Fitzgerald lowered its target from $170 to $120, while Bernstein reduced its target from $180 to $120; Oppenheimer and Citizens JMP downgraded the shares to “market perform.” These actions signal reduced confidence in Reddit’s near-term growth trajectory. Reddit Analysts Slash Their Forecasts Following Q3 Earnings

Institutional Investors Weigh In On Reddit

Institutional investors and hedge funds have recently made changes to their positions in the stock. Sunbelt Securities Inc. raised its holdings in shares of Reddit by 87.5% in the 1st quarter. Sunbelt Securities Inc. now owns 195 shares of the company's stock valued at $26,000 after buying an additional 91 shares during the period. Ascentis Independent Advisors purchased a new position in Reddit during the 1st quarter valued at about $30,000. EverSource Wealth Advisors LLC boosted its holdings in Reddit by 48.1% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 197 shares of the company's stock valued at $34,000 after acquiring an additional 64 shares during the period. Beacon Investment Advisory Services Inc. acquired a new position in Reddit in the 2nd quarter valued at about $35,000. Finally, Root Financial Partners LLC acquired a new position in Reddit in the 3rd quarter valued at about $41,000.

Reddit Price Performance

The company has a market capitalization of $18.60 billion, a PE ratio of 22.59, a price-to-earnings-growth ratio of 0.62 and a beta of 2.05. The stock's 50 day simple moving average is $151.54 and its 200-day simple moving average is $161.02.

Reddit (NYSE:RDDT - Get Free Report) last issued its quarterly earnings results on Thursday, October 29th. The company reported $1.40 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.33 by $0.07. Reddit had a net margin of 31.35% and a return on equity of 29.02%. The business had revenue of $894.96 million for the quarter, compared to analysts' expectations of $874.91 million. During the same quarter in the prior year, the company earned $0.80 earnings per share. The business's quarterly revenue was up 53.0% on a year-over-year basis. On average, equities analysts predict that Reddit Inc. will post 5.28 earnings per share for the current year.

Reddit Company Profile

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.

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