Reddit Inc. (RDDT) ended the recent trading session at $270.71, demonstrating a +1.59% change from the preceding day's closing price. This move outpaced the S&P 500's daily gain of 0.48%. Elsewhere, the Dow gained 0.27%, while the tech-heavy Nasdaq added 0.94%.
Heading into today, shares of the company had gained 22.03% over the past month, outpacing the Computer and Technology sector's gain of 5.46% and the S&P 500's gain of 2.46%.
Investors will be eagerly watching for the performance of Reddit Inc. in its upcoming earnings disclosure. On that day, Reddit Inc. is projected to report earnings of $0.5 per share, which would represent year-over-year growth of 212.5%. Our most recent consensus estimate is calling for quarterly revenue of $549.69 million, up 57.8% from the year-ago period.
RDDT's full-year Zacks Consensus Estimates are calling for earnings of $1.82 per share and revenue of $2.05 billion. These results would represent year-over-year changes of +154.65% and +57.36%, respectively.
Investors should also pay attention to any latest changes in analyst estimates for Reddit Inc. These recent revisions tend to reflect the evolving nature of short-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been a 0.78% rise in the Zacks Consensus EPS estimate. Currently, Reddit Inc. is carrying a Zacks Rank of #1 (Strong Buy).
Investors should also note Reddit Inc.'s current valuation metrics, including its Forward P/E ratio of 146.48. This signifies a premium in comparison to the average Forward P/E of 31.99 for its industry.
One should further note that RDDT currently holds a PEG ratio of 4.19. 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 industry currently had an average PEG ratio of 2.27 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 68, which puts it in the top 28% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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Reddit Inc. (RDDT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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