Shares of Reddit Inc (NASDAQ:RDDT) were last seen down 1.5% to trade at $229.76, despite Needham adding it to its "Conviction buy" list for 2026. The firm noted Reddit's fast-growing ad platform, boosted by its AI-powered advertising tools, as well as its authentic content. Notably, this is the third analyst to name RDDT a "top pick" this month.
On the charts, RDDT has found recent support at the ascending 20-day moving average, though the $240 level appears to be emerging as pressure. Since the start of the year, the equity is up 40.6%.
Even with shares pulling back today, there is plenty of short covering potential to fuel a bounce. After rising 9.4% in the past month, short interest represents 13.8% of the stock's available float.
When weighing in, options look like a good way to go. RDDT's Schaeffer's Volatility Index (SVI) of 57% ranks in the lowest percentile of its annual range, meaning options traders are pricing in extremely low volatility expectations.
