Reddit (NYSE:RDDT) Earns "Buy" Rating from Needham & Company LLC

Key Points

• Needham & Company reissued a "Buy" rating on Reddit with a $300 price target, implying about a 103.5% upside, while the consensus among analysts is a "Moderate Buy" with a $229.79 average target.
• Reddit reported a strong Q1 beat—EPS $1.01 vs. $0.62 expected and revenue $663.4M vs. $607.7M—with ad revenue up ~74% and management guiding Q2 revenue of $715M–$725M, citing AI-driven ad products as a key growth driver.
• Insiders and institutions are actively trading the stock: a director bought shares recently and insiders have net bought and sold material amounts in the last 90 days, while major funds (Vanguard, Capital World Investors, State Street, Morgan Stanley) increased holdings.

Reddit (NYSE:RDDT - Get Free Report)'s stock had its "buy" rating reissued by Needham & Company LLC in a research report issued on Friday,Benzinga reports. They presently have a $300.00 price target on the stock. Needham & Company LLC's price objective would suggest a potential upside of 103.53% from the company's current price.

Other research analysts also recently issued research reports about the stock. Wells Fargo & Company reiterated a "positive" rating on shares of Reddit in a research report on Friday. JPMorgan Chase & Co. decreased their price target on shares of Reddit from $227.00 to $200.00 and set a "neutral" rating for the company in a research note on Friday, February 6th. Citigroup restated an "outperform" rating on shares of Reddit in a research note on Friday. UBS Group set a $265.00 price target on shares of Reddit in a research note on Tuesday, January 13th. Finally, Morgan Stanley set a $240.00 target price on shares of Reddit in a research note on Friday, February 6th. One investment analyst has rated the stock with a Strong Buy rating, nineteen have given a Buy rating and ten have given a Hold rating to the stock. According to MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and a consensus target price of $229.79.

Reddit Stock Down 0.2%

Reddit stock opened at $147.40 on Friday. Reddit has a 12-month low of $94.89 and a 12-month high of $282.95. The firm's fifty day moving average is $144.12 and its 200 day moving average is $184.31. The company has a market capitalization of $28.16 billion, a PE ratio of 56.26, a PEG ratio of 1.07 and a beta of 2.40.

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

Insider Activity

In other news, Director Sarah E. Farrell bought 10,500 shares of Reddit stock in a transaction dated Friday, March 13th. The stock was purchased at an average price of $132.26 per share, for a total transaction of $1,388,730.00. Following the purchase, the director directly owned 61,000 shares in the company, valued at $8,067,860. The trade was a 20.79% increase in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, COO Jennifer L. Wong sold 39,167 shares of the company's stock in a transaction 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 owned 1,088,451 shares of the company's stock, valued at approximately $175,752,182.97. The trade was a 3.47% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders have bought 61,000 shares of company stock worth $8,870,815 and have sold 280,441 shares worth $40,873,759. 34.25% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Reddit

Institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. boosted its stake in Reddit by 8.9% in the fourth quarter. Vanguard Group Inc. now owns 13,322,048 shares of the company's stock valued at $3,062,339,000 after acquiring an additional 1,083,540 shares during the last quarter. Capital World Investors purchased a new position in Reddit in the fourth quarter valued at about $1,293,258,000. State Street Corp boosted its stake in Reddit by 6.0% in the fourth quarter. State Street Corp now owns 2,631,332 shares of the company's stock valued at $604,864,000 after acquiring an additional 149,401 shares during the last quarter. Geode Capital Management LLC boosted its stake in Reddit by 4.7% in the fourth quarter. Geode Capital Management LLC now owns 2,382,712 shares of the company's stock valued at $546,789,000 after acquiring an additional 106,821 shares during the last quarter. Finally, Morgan Stanley boosted its stake in Reddit by 11.4% in the fourth quarter. Morgan Stanley now owns 2,372,443 shares of the company's stock valued at $545,354,000 after acquiring an additional 242,709 shares during the last quarter.

Key Stories Impacting Reddit

Here are the key news stories impacting Reddit this week:

• Positive Sentiment: Q1 results beat expectations — Reddit reported EPS of $1.01 vs. $0.62 consensus and revenue of $663.4M vs. $607.7M expected; ad revenue surged ~74%, and the company posted a $204M profit, signaling improved monetization and operating leverage. MarketBeat Earnings Summary
• Positive Sentiment: Management issued stronger Q2 revenue guidance of $715M–$725M (above consensus ~$713M), reinforcing the view that ad demand and AI tools will sustain growth — a key driver of the intraday rally. Reuters Guidance Story
• Positive Sentiment: AI-driven ad products highlighted as growth engine — management and coverage emphasize Reddit’s tools that improve ad performance and yield faster monetization of community content, which lifted investor optimism and premarket buying. Reuters: AI-Driven Ad Growth
• Neutral Sentiment: Analyst and media coverage — multiple outlets (CNBC, WSJ, Seeking Alpha) replayed the beat + guide, providing broad visibility; transcripts and investor materials are available for deeper due diligence. Earnings Call Transcript
• Neutral Sentiment: CEO commentary frames Reddit as “the fuel” for AI — positioning the company as a strategic data/engagement asset for models, which could support long-term strategic value but also invites regulatory/data-use scrutiny. CNBC Interview
• Negative Sentiment: Valuation and volatility risks — RDDT trades at high multiples (P/E ~56) with a beta ~2.4 and remains well below its 200‑day moving average, so upside from this print may be limited if growth slows or if investors take profits. WSJ Coverage / Context

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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