Core Insights - Reddit (RDDT) is expected to report fourth-quarter earnings with anticipated revenue growth of 64% year-over-year, reaching $408.92 million, and earnings of $47.6 million, significantly up from $18.53 million in the same quarter last year [1] - Analysts project an increase in daily active users to 103.24 million, up from 73.10 million a year ago [1] Analyst Ratings and Price Targets - Among 11 analysts tracking Reddit, eight have a "buy" rating while three have a "hold" rating, with an average price target of approximately $206, indicating a 9% decline from the recent closing price of $224.93 [2] - The stock has increased nearly 40% since the beginning of the year, surpassing most targets set in January [2] Price Target Upgrades - Deutsche Bank raised its price target for Reddit to $235 from $195, citing potential revenue growth from increased daily active users and advertising revenue [3] - The introduction of Reddit Answers, an AI tool for summarizing posts, is expected to enhance advertising revenue by attracting search budgets through promoted links [3] Growth Potential - Morgan Stanley highlighted that Reddit could leverage multiple growth opportunities by 2025, including a partnership with Alphabet's Google to direct searches to Reddit links [4] - A larger user base spending more time on the platform would make Reddit more appealing to advertisers, potentially aligning its ad pricing with competitors like Google and Meta Platforms [4] Stock Performance - Reddit's shares experienced slight changes after reaching an all-time high, with the stock price increasing nearly sevenfold from its IPO price of $34 in March 2024 [5]
What Analysts Think of Reddit Stock Ahead of Earnings