Reddit (NYSE:RDDT) Trading Down 7.6% – Here’s What Happened
by Danessa Lincoln · The Markets DailyShares of Reddit Inc. (NYSE:RDDT – Get Free Report) were down 7.6% during mid-day trading on Thursday . The stock traded as low as $240.50 and last traded at $233.3190. Approximately 733,362 shares changed hands during trading, a decline of 79% from the average daily volume of 3,474,132 shares. The stock had previously closed at $252.38.
Key Reddit News
Here are the key news stories impacting Reddit this week:
- Positive Sentiment: Strategic partnership: Emplifi integrated Reddit’s Enterprise API, positioning Reddit as a signal in a large marketing platform — this supports enterprise monetization and data-product adoption. Read More.
- Positive Sentiment: Analyst momentum: Wells Fargo raised its target price and Reddit’s momentum metrics surged into a high percentile, which likely attracted momentum and quant buyers. Read More.
- Neutral Sentiment: Earnings date set: Reddit will release Q4 and FY2025 results on Feb 5, giving investors a clear near‑term catalyst for revenue/ads guidance and SMB traction. Read More.
- Neutral Sentiment: Stock is widely watched: Zacks highlights RDDT as a stock drawing investor attention, which can amplify moves around news and analyst notes. Read More.
- Neutral Sentiment: Minor insider sale: Director Andrew Vollero sold 300 shares — a small, likely immaterial transaction. Read More.
- Negative Sentiment: Large insider sale: Reddit’s CFO sold nearly $960k of stock — sizable insider selling can spook investors and raise questions about near‑term conviction. Read More.
- Negative Sentiment: Analyst concerns on SMB ad checks: RBC flagged challenges with small‑business ad checks and mixed ad feedback, pressuring sentiment around ad revenue sustainability. Read More.
- Negative Sentiment: Mixed ad feedback: Multiple outlets report analysts warning of uneven advertiser feedback, which feeds worries about near‑term ad monetization and growth. Read More.
- Negative Sentiment: Recent price weakness: Coverage notes a sharp intraday drop recently and commentary calling the move a significant selloff, reflecting heightened volatility. Read More.
- Negative Sentiment: Broader market trigger: News that shook growth stocks (FDA delay for a major weight‑loss drug) contributed to a stumble in Reddit shares as risk‑on sentiment softened. Read More.
- Negative Sentiment: Retail investor mixed view: After a recent sharp down day, retail traders flagged trouble but some remain bullish — an indicator of potential short‑term volatility as sentiment rebalances. Read More.
- Negative Sentiment: Explanatory coverage: Multiple outlets ran pieces titled that Reddit is “nosediving”—the tone can amplify selling pressure among momentum traders. Read More.
Wall Street Analyst Weigh In
Several research analysts have recently issued reports on the company. The Goldman Sachs Group reaffirmed a “neutral” rating and set a $236.00 price target on shares of Reddit in a research note on Tuesday, October 14th. Royal Bank Of Canada reiterated a “sector perform” rating on shares of Reddit in a research report on Wednesday, October 1st. B. Riley restated a “buy” rating and set a $245.00 price objective (up from $235.00) on shares of Reddit in a research report on Friday, October 31st. Raymond James Financial reiterated a “strong-buy” rating and set a $250.00 target price (up previously from $225.00) on shares of Reddit in a report on Monday, October 20th. Finally, Argus set a $300.00 price objective on Reddit in a research report on Friday, January 9th. Three research analysts have rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating, twelve have assigned a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company currently has an average rating of “Moderate Buy” and a consensus target price of $238.57.
Read Our Latest Research Report on Reddit
Reddit Stock Performance
The company has a market cap of $43.84 billion, a PE ratio of 132.95, a PEG ratio of 1.54 and a beta of 2.17. The firm has a fifty day simple moving average of $223.41 and a 200 day simple moving average of $210.31.
Reddit (NYSE:RDDT – Get Free Report) last released its earnings results on Thursday, October 30th. The company reported $0.80 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.50 by $0.30. Reddit had a net margin of 18.33% and a return on equity of 14.94%. The firm had revenue of $584.91 million during the quarter, compared to the consensus estimate of $546.65 million. During the same period in the previous year, the firm earned $0.16 earnings per share. Reddit’s revenue was up 67.9% compared to the same quarter last year. As a group, equities analysts predict that Reddit Inc. will post 1.12 EPS for the current fiscal year.
Insider Activity
In related news, CTO Christopher Brian Slowe sold 24,000 shares of the stock in a transaction dated Monday, November 24th. The shares were sold at an average price of $192.72, for a total transaction of $4,625,280.00. Following the sale, the chief technology officer owned 175,694 shares in the company, valued at $33,859,747.68. This represents a 12.02% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, insider Benjamin Seong Lee sold 55,005 shares of the company’s stock in a transaction that occurred on Tuesday, December 16th. The shares were sold at an average price of $221.21, for a total value of $12,167,656.05. Following the transaction, the insider directly owned 62,608 shares of the company’s stock, valued at $13,849,515.68. This trade represents a 46.77% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 505,470 shares of company stock valued at $109,018,861. Corporate insiders own 34.25% of the company’s stock.
Hedge Funds Weigh In On Reddit
Several large investors have recently bought and sold shares of the stock. StoneCrest Wealth Management Inc. lifted its stake in shares of Reddit by 8.9% in the 4th quarter. StoneCrest Wealth Management Inc. now owns 7,016 shares of the company’s stock worth $1,613,000 after acquiring an additional 576 shares during the period. Perigon Wealth Management LLC raised its holdings in Reddit by 78.7% during the fourth quarter. Perigon Wealth Management LLC now owns 2,318 shares of the company’s stock worth $533,000 after purchasing an additional 1,021 shares in the last quarter. Genesis Financial Group LLC bought a new position in Reddit during the 4th quarter valued at $737,000. Aberdeen Group plc increased its position in shares of Reddit by 61.4% during the 4th quarter. Aberdeen Group plc now owns 7,360 shares of the company’s stock valued at $1,692,000 after purchasing an additional 2,801 shares during the period. Finally, FNY Investment Advisers LLC raised its stake in shares of Reddit by 5,200.0% in the 4th quarter. FNY Investment Advisers LLC now owns 689 shares of the company’s stock worth $158,000 after buying an additional 676 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.