Analyst Ronald Josey of Citi reiterated a Buy rating on Reddit Inc Class A, retaining the price target of $265.00.
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Ronald Josey has given his Buy rating due to a combination of factors that highlight Reddit Inc’s potential for growth and monetization. The recent meetings with Reddit’s COO and Head of IR have provided insights into the company’s strategies, particularly the focus on increasing Daily Active Users (DAUs) through product-led growth initiatives. The introduction of a straight-to-feed onboarding process for new app users is expected to enhance user engagement by reducing friction and personalizing content delivery, which could lead to significant growth in user activity.
Additionally, Reddit’s monetization prospects are promising with the development of new products like Reddit Pro and advanced advertising tools that are likely to attract more ad spending. The company’s unique data corpus is also seen as a valuable asset, offering opportunities for data licensing. Given the recent decline in share prices and Reddit’s position as the fastest-growing ad platform, Josey sees this as an opportune moment to invest, reaffirming his Buy rating with a target price of $265.