Reddit Inc. (RDDT) closed the most recent trading day at $196.30, moving -8.11% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.41% for the day. Meanwhile, the Dow experienced a drop of 0.83%, and the technology-dominated Nasdaq saw an increase of 0.91%.
Prior to today's trading, shares of the company had lost 8.96% lagged the Computer and Technology sector's gain of 0.49% and the S&P 500's gain of 0.38%.
The upcoming earnings release of Reddit Inc. will be of great interest to investors. The company's earnings report is expected on February 5, 2026. The company is predicted to post an EPS of $0.96, indicating a 166.67% growth compared to the equivalent quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $667.58 million, indicating a 56.08% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.32 per share and a revenue of $2.14 billion, indicating changes of +169.67% and 0%, respectively, from the former year.
Investors should also note any recent changes to analyst estimates for Reddit Inc. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 3.18% fall in the Zacks Consensus EPS estimate. Reddit Inc. currently has a Zacks Rank of #4 (Sell).
With respect to valuation, Reddit Inc. is currently being traded at a Forward P/E ratio of 57.21. For comparison, its industry has an average Forward P/E of 24.04, which means Reddit Inc. is trading at a premium to the group.
One should further note that RDDT currently holds a PEG ratio of 1.48. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Software industry had an average PEG ratio of 1.42 as trading concluded yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 78, finds itself in the top 32% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much 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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