Reddit (NYSE:RDDT) Downgraded to "Hold" Rating by Zacks Research

Key Points

• Zacks Research downgraded Reddit from strong-buy to hold, even as other analysts remain generally constructive on the stock.
• Reddit beat Wall Street expectations in its latest quarter, reporting $1.01 EPS versus $0.62 expected and $663.41 million in revenue, up 69.1% year over year.
• Shares were up 8.3% on the day, with Reddit trading around $183.50; meanwhile, insider selling continued, including recent sales by the COO and CTO under pre-arranged trading plans.

Reddit (NYSE:RDDT - Get Free Report) was downgraded by investment analysts at Zacks Research from a "strong-buy" rating to a "hold" rating in a research note issued to investors on Wednesday,Zacks.com reports.

A number of other equities analysts have also weighed in on the company. Wells Fargo & Company upped their target price on Reddit from $149.00 to $176.00 and gave the stock an "equal weight" rating in a research note 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. JPMorgan Chase & Co. dropped their price target on Reddit from $227.00 to $200.00 and set a "neutral" rating for the company in a research note on Friday, February 6th. Cantor Fitzgerald lifted their price target on Reddit from $170.00 to $180.00 and gave the stock a "neutral" rating in a research note on Friday, May 1st. Finally, Guggenheim lifted their price target on Reddit from $245.00 to $255.00 and gave the stock a "buy" rating in a research note on Friday, February 6th. Eighteen investment analysts have rated the stock with a Buy rating and twelve have assigned a Hold rating to the stock. According to MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus target price of $230.75.

Reddit Stock Up 8.3%

Shares of NYSE RDDT opened at $183.50 on Wednesday. The firm has a market capitalization of $35.33 billion, a P/E ratio of 52.43 and a beta of 1.91. The stock's 50-day simple moving average is $152.45 and its two-hundred day simple moving average is $177.39. Reddit has a twelve month low of $110.85 and a twelve month high of $282.95.

Reddit (NYSE:RDDT - Get Free Report) last announced its earnings results on Thursday, April 30th. The company reported $1.01 earnings per share for the quarter, topping analysts' consensus estimates of $0.62 by $0.39. The business had revenue of $663.41 million for the quarter, compared to analyst estimates of $607.74 million. Reddit had a return on equity of 25.48% and a net margin of 28.60%.The company's quarterly revenue was up 69.1% compared to the same quarter last year. During the same period in the prior year, the company earned $0.13 EPS. As a group, research analysts anticipate that Reddit will post 4.83 EPS for the current fiscal year.

Insiders Place Their Bets

In other Reddit news, COO Jennifer L. Wong sold 39,167 shares of Reddit stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $158.52, for a total transaction of $6,208,752.84. Following the completion of the sale, the chief operating officer owned 1,088,451 shares of the company's stock, valued at $172,541,252.52. The trade was a 3.47% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CTO Christopher Brian Slowe sold 15,500 shares of Reddit stock in a transaction dated Wednesday, April 8th. The stock was sold at an average price of $150.67, for a total value of $2,335,385.00. Following the sale, the chief technology officer directly owned 38,413 shares of the company's stock, valued at approximately $5,787,686.71. This trade represents a 28.75% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 259,999 shares of company stock valued at $39,812,508 over the last 90 days. Insiders own 28.48% of the company's stock.

Institutional Investors Weigh In On Reddit

Several institutional investors have recently bought and sold shares of the stock. Vanguard Group Inc. grew its holdings in shares of Reddit by 12.9% in the third quarter. Vanguard Group Inc. now owns 12,238,508 shares of the company's stock worth $2,814,734,000 after purchasing an additional 1,401,293 shares during the last quarter. Truist Financial Corp grew its holdings in shares of Reddit by 67.7% in the fourth quarter. Truist Financial Corp now owns 15,659 shares of the company's stock worth $3,600,000 after purchasing an additional 6,321 shares during the last quarter. Swiss Life Asset Management Ltd grew its holdings in shares of Reddit by 63.2% in the fourth quarter. Swiss Life Asset Management Ltd now owns 32,003 shares of the company's stock worth $7,357,000 after purchasing an additional 12,398 shares during the last quarter. WT Asset Management Ltd bought a new position in shares of Reddit in the third quarter worth approximately $92,973,000. Finally, Calamos Advisors LLC bought a new position in shares of Reddit in the fourth quarter worth approximately $2,299,000.

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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