Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 17 Mar, 26 | RDDT | Buy | USD 146.74 | USD 155.0 | USD 164.0 | 9 days | Closed |
11.41%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Profitability Turnaround: FY25 net income stood at USD 530 million compared to a net loss in FY24, representing a year-over-year improvement of approximately USD 1,014 million
Strong Revenue Expansion: FY25 revenue increased to USD 2.2 billion compared to FY24 revenue of approximately USD 1.30 billion, reflecting a 69% year-over-year growth
High Dependence on Advertising Revenue: Q4 FY25 advertising revenue reached USD 690 million compared to approximately USD 394 million in Q4 FY24
Rising Operating Expense Base: FY25 adjusted operating expenses increased to approximately USD 340.1 million in Q4 FY25 compared to USD 241.8 million in Q4 FY24
Reddit’s long-term performance remains sensitive to its heavy reliance on advertising revenue, evolving user engagement dynamics, and the ability to sustain monetization efficiency amid increasing competition and AI-driven platform shifts
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 146.74 | 130.0 | 155.0 | 164.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Breakout Year Marked by Strong Revenue Expansion: Reddit delivered a transformative financial performance in FY25, with total revenue reaching USD 2.2 billion, reflecting a robust 69% year-over-year increase. This growth was primarily driven by sustained momentum in the advertising business, supported by strong performance across geographies, verticals, and advertiser segments. The company demonstrated scalability in its monetization engine, benefiting from increased ad impressions and improved pricing dynamics.
Significant Improvement in Profitability Metrics: The company reported net income of USD 530 million in FY25, a substantial turnaround from the prior year, with net margins expanding to 24%. This reflects both operating leverage and disciplined cost management. Adjusted EBITDA increased to USD 845 million, translating to a margin of 38%, highlighting the company’s ability to convert revenue growth into meaningful profitability expansion.
Strong Cash Flow Generation and Balance Sheet Strength: Reddit exhibited notable improvement in cash generation, with operating cash flow reaching USD 691 million and free cash flow at USD 684 million in FY25. The company ended the year with a strong liquidity position of approximately USD 2.48 billion in cash and equivalents, reinforcing financial flexibility. This robust cash profile enabled the announcement of a USD 1 billion share repurchase program, signaling confidence in long-term cash generation capabilities.
User Growth and Engagement Trends: Operationally, Reddit continued to scale its user base, with Daily Active Uniques (DAUq) reaching 121.4 million in Q4 FY25, reflecting 19% year-over-year growth, while Weekly Active Uniques (WAUq) increased 24% year-over-year. Growth was particularly strong in international markets, which expanded at a faster pace compared to the U.S., indicating increasing global adoption of the platform.
Advertising-Led Monetization Momentum: Advertising remained the core revenue driver, contributing USD 690 million in Q4 FY25 alone, representing 75% year-over-year growth. The company benefited from improvements across the full advertising funnel, including enhanced machine learning models, better targeting capabilities, and the launch of AI-powered solutions such as Reddit Max campaigns. These innovations improved advertiser ROI and drove higher engagement and conversion outcomes.
Product Innovation and AI Integration: Reddit accelerated its product innovation roadmap in FY25, focusing on AI-driven personalization, improved onboarding, and enhanced search capabilities. The integration of Reddit Answers and AI-powered search significantly increased platform utility, with over 80 million weekly users engaging in search activities. Additionally, investments in machine learning enhanced content relevance and user retention, supporting long-term engagement and monetization potential.
Cost Discipline and Operating Leverage: Despite elevated investments in hiring and marketing, Reddit maintained strong cost discipline, with total adjusted costs growing significantly slower than revenue. This operating leverage enabled margin expansion across EBITDA and net income levels. The company’s asset-light model, characterized by minimal capital expenditure requirements, further supported high incremental margins and strong free cash flow conversion.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to Reddit, Inc (NASDAQ: RDDT) at the current market price of USD 146.74, as on Mar 17,2026 at 7:56 am PDT
Data Powered by EOD Historical Data (“EODHD”).
Sector: Industry:
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) |
|---|---|---|---|---|---|---|
| RDDT Reddit, Inc. |
-5.9 3.31% | 172.21 | - | - | - | - |
Data Powered by EOD Historical Data (“EODHD”).
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on March 17, 2026. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned has been achieved and is subject to the factors discussed above.
Note 4: StockNextt reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Disclaimer :
This report has been issued by StockNextt which has an Ontario Business Identification Number 1000958347 and British Columbia registration Number FM1051529 is a trade name under Kalkine Canada Advisory Services Inc. having Business Number 761925130BC0001. Kalkine Canada Advisory Services Inc. and StockNextt are collectively referred to as “StockNextt”, “we”, “us”, and “our”. The website https://stocknextt.com and associated pages are published by StockNextt. The information in this report and on the StockNextt website has been prepared from a wide variety of sources, which StockNextt, to the best of its knowledge and belief, considers accurate. StcokNextt has made every effort to ensure the reliability of information contained in its reports, newsletters, and websites. All information represents our views at the date of publication and may change without notice. The information in this report does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products. Our reports contain general recommendations for investing in securities and other financial products. StockNextt does not offer financial advice based upon your personal financial situation or goals, and we shall not be held liable for any investment or trading losses you may incur by using the opinions expressed in our reports, publications, market updates, news alerts and corporate profiles. StockNextt does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. StockNextt’s general advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested. Please also read our Terms and conditions for further information. Employees and/or associates of StockNextt and its related entities may hold an interest in the securities or other financial products covered in this report or on the StockNextt website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.
Copyright © 2026 Krish Capital Pty Ltd. All rights reserved. No part of this website, or its content, may be reproduced in any form without our prior consent.
Australia