Reddit (NYSE:RDDT) Cut to "Hold" at Wall Street Zen

Key Points

• Wall Street Zen downgraded Reddit from “buy” to “hold,” even though broader analyst sentiment remains positive with an average rating of “Moderate Buy” and an average price target of $228.61.
• Reddit reported stronger-than-expected Q1 results, posting $1.01 EPS versus the $0.62 estimate and revenue of $663.41 million, up 69.1% year over year.
• Insider activity has been mixed: CEO Steve Huffman sold 18,000 shares, while Director Sarah E. Farrell bought 10,500 shares; insiders still own 34.25% of the company.

Reddit (NYSE:RDDT - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a report issued on Sunday.

Several other equities analysts have also recently weighed in on RDDT. DA Davidson reissued a "buy" rating and set a $200.00 price objective on shares of Reddit in a research report on Friday, May 1st. Zacks Research upgraded Reddit from a "hold" rating to a "strong-buy" rating in a research note on Tuesday, May 5th. Evercore restated an "outperform" rating and set a $290.00 price target on shares of Reddit in a research note on Friday, February 6th. B. Riley Financial boosted their price target on Reddit from $245.00 to $250.00 and gave the company a "buy" rating in a research note on Friday, February 6th. Finally, Morgan Stanley set a $240.00 price target on Reddit in a research note on Friday, February 6th. One investment analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and eleven have given a Hold rating to the company. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $228.61.

Reddit Stock Performance

NYSE RDDT opened at $155.74 on Friday. Reddit has a twelve month low of $94.89 and a twelve month high of $282.95. The stock has a market capitalization of $29.75 billion, a PE ratio of 44.50, a P/E/G ratio of 0.95 and a beta of 1.85. The stock has a 50-day simple moving average of $145.45 and a 200 day simple moving average of $183.43.

Reddit (NYSE:RDDT - Get Free Report) last posted its quarterly earnings data on Thursday, April 30th. The company reported $1.01 earnings per share for the quarter, topping the consensus estimate of $0.62 by $0.39. Reddit had a return on equity of 25.48% and a net margin of 28.60%.The business had revenue of $663.41 million during the quarter, compared to analysts' expectations of $607.74 million. During the same quarter in the previous year, the firm earned $0.13 EPS. The firm's revenue was up 69.1% compared to the same quarter last year. As a group, equities research analysts forecast that Reddit will post 4.78 EPS for the current fiscal year.

Insider Buying and Selling

In other news, CEO Steve Ladd Huffman sold 18,000 shares of the company's stock in a transaction that occurred on Tuesday, May 5th. The stock was sold at an average price of $171.80, for a total value of $3,092,400.00. Following the sale, the chief executive officer directly owned 411,195 shares in the company, valued at approximately $70,643,301. This represents a 4.19% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Sarah E. Farrell acquired 10,500 shares of the stock in a transaction dated Friday, March 13th. The stock was bought at an average price of $132.26 per share, for a total transaction of $1,388,730.00. Following the completion of the purchase, the director owned 61,000 shares in the company, valued at approximately $8,067,860. This trade represents a 20.79% increase in their position. The disclosure for this purchase is available in the SEC filing. In the last 90 days, insiders have purchased 61,000 shares of company stock valued at $8,870,815 and have sold 298,441 shares valued at $43,966,159. Company insiders own 34.25% of the company's stock.

Institutional Investors Weigh In On Reddit

Several large investors have recently modified their holdings of RDDT. PNC Financial Services Group Inc. boosted its holdings in shares of Reddit by 6.5% in the 1st quarter. PNC Financial Services Group Inc. now owns 6,445 shares of the company's stock worth $868,000 after acquiring an additional 393 shares in the last quarter. Andra AP fonden boosted its holdings in shares of Reddit by 152.6% in the 1st quarter. Andra AP fonden now owns 172,100 shares of the company's stock worth $23,173,000 after acquiring an additional 103,972 shares in the last quarter. Cassaday & Co Wealth Management LLC acquired a new position in shares of Reddit in the 1st quarter worth approximately $46,000. Johnson Financial Group Inc. acquired a new position in shares of Reddit in the 1st quarter worth approximately $195,000. Finally, Meeder Advisory Services Inc. boosted its holdings in shares of Reddit by 7.4% in the 1st quarter. Meeder Advisory Services Inc. now owns 1,544 shares of the company's stock worth $208,000 after acquiring an additional 107 shares in the last quarter.

About Reddit

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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