Reddit Inc. (RDDT) ended the recent trading session at $149.66, demonstrating a +1.03% change from the preceding day's closing price. The stock outpaced the S&P 500's daily gain of 0.4%. At the same time, the Dow added 0.47%, and the tech-heavy Nasdaq gained 0.24%.
Shares of the company have appreciated by 2.9% over the course of the past month, underperforming the Computer and Technology sector's gain of 6.84%, and the S&P 500's gain of 4.61%.
Analysts and investors alike will be keeping a close eye on the performance of Reddit Inc. in its upcoming earnings disclosure. The company's earnings report is set to go public on July 31, 2025. On that day, Reddit Inc. is projected to report earnings of $0.19 per share, which would represent year-over-year growth of 416.67%. In the meantime, our current consensus estimate forecasts the revenue to be $426.49 million, indicating a 51.68% growth compared to the corresponding quarter of the prior year.
RDDT's full-year Zacks Consensus Estimates are calling for earnings of $1.21 per share and revenue of $1.85 billion. These results would represent year-over-year changes of +136.34% and +41.98%, respectively.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Reddit Inc. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Reddit Inc. is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Reddit Inc. is holding a Forward P/E ratio of 122.79. This denotes a premium relative to the industry average Forward P/E of 29.31.
It's also important to note that RDDT currently trades at a PEG ratio of 3.8. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Software was holding an average PEG ratio of 2.19 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 79, placing it within the top 32% of over 250 industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Reddit Inc. (RDDT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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