Reddit (RDDT) PT Raised to $158 at Citi

Citi analyst Ronald Josey raised the price target on Reddit (NYSE: RDDT) to $158.00 (from $150.00) while maintaining a Buy rating.

The analyst comments "Reddit delivered better-than-expected 1Q results, with ad revenue growth accelerating to +61% Y/Y, 70% operating leverage & 29% EBITDA margins, as 1Q DAUq net adds rebounded to +6.4M (+4.5M in 4Q24). Key here, engagement gains and newer products (like Reddit Answers) are attracting incremental users and we were impressed by 50%+ Y/Y growth in active advertisers. This 1Q momentum, as management suggested, continued into April. That said, the debate out of the quarter is the DAUq slowdown stemming from Google’s algo changes in December and March. But given engagement growth and improving ROAS, we do not believe the slowdown impacts revenue growth. In fact, with the broader rollout of Answers and the likelihood that DPA (shopping) ads launch this year, we believe there are several potential catalysts for Reddit to deliver continued user and revenue growth. We reiterate our Buy rating and raise our TP to $158, from $150."

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