Reddit stock rating reaffirmed at Bernstein, PT held at $150

On Wednesday, Bernstein SocGen Group maintained its Underperform rating on Reddit (NYSE: RDDT) shares, with a consistent price target of $150.00. According to InvestingPro data, the stock is currently trading significantly above analyst consensus targets, with price targets ranging from $105 to $250. With a market capitalization of $38 billion and impressive revenue growth of 49% in the last twelve months, Reddit has captured significant investor attention. The firm’s analysis followed a notable day of trading for companies within the digital advertising space, which saw significant stock movements after reporting their earnings.

The analyst drew a parallel between the competitive nature of golf tournaments and the recent shifts in stock positions among digital ad companies. Reddit’s stock experienced a 15% decline in after-hours trading, while its industry counterparts, Applovin and TradeDesk, saw divergent results; Applovin’s shares surged by 27%, whereas TradeDesk’s shares plummeted by 27%. Despite recent volatility, InvestingPro analysis reveals Reddit maintains strong fundamentals with an exceptional gross profit margin of 89% and a healthy current ratio of 11.96, suggesting robust operational efficiency. Get access to 14+ additional ProTips and comprehensive financial analysis with InvestingPro.

According to the analyst’s remarks, to ascend in the stock price rankings, companies had to outperform not only investor expectations but also their industry peers. Reddit’s latest earnings report delivered a mixed outcome, which the analyst suggested caused the company’s stock to drop in the rankings. Despite acknowledging Reddit’s solid execution, the analyst pointed out a new issue with user engagement that influenced the decision to maintain the Underperform rating and the $150.00 price target. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading above its intrinsic value, though the company shows strong momentum with a 329% return over the past year.

The report from Bernstein SocGen Group emphasizes the competitive landscape of the digital advertising market, where companies are closely watched for their performance relative to expectations and each other. Reddit’s recent financial results and the subsequent stock reaction reflect the ongoing challenges and dynamics within this sector. For deeper insights into Reddit’s valuation and competitive position, including access to the comprehensive Pro Research Report covering 1,400+ top stocks, visit InvestingPro.

In other recent news, Reddit has been the focus of numerous analyst updates. JPMorgan raised the company’s stock price target to $185, maintaining a neutral rating, despite a dip in daily active users and a slightly weaker first-quarter revenue forecast. Reddit’s advertising revenue growth accelerated to 60% year-over-year in the fourth quarter, leading to substantial profit gains. The firm also increased its revenue and adjusted EBITDA estimates for Reddit for the years 2025 and 2026.

Jefferies analyst John Colantuoni adjusted Reddit’s price target down to $225 from $230, maintaining a Buy rating. The firm acknowledged the company’s impressive results and forward-looking guidance, despite an unexpected slowdown in U.S. user growth.

Raymond (NSE:RYMD) James reaffirmed its Strong Buy rating and $250.00 price target for Reddit, following the company’s latest earnings report. The firm highlighted Reddit’s revenue outperformance and significant EBITDA, which surpassed the Street’s forecast.

Citi analyst Ronald Josey increased Reddit’s price target to $220, reiterating a Buy rating. Josey cited a robust increase in advertising revenue and expanding margins as reasons for optimism about Reddit’s financial health.

Finally, JMP Securities increased Reddit’s price target to $200, maintaining a Market Outperform rating. The firm highlighted Reddit’s advertising revenue as a key strength and noted the company’s resilience in its search engine optimization. These are the latest developments for Reddit.

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