Reddit (RDDT) PT Lowered to $170 at Cantor Fitzgerald

Cantor Fitzgerald analyst Deepak Mathivanan lowered the price target on Reddit (NYSE: RDDT) to $170.00 (from $200.00) while maintaining a Neutral rating.

The analyst commented, "RDDT reported 2Q results with a 10% and 14% beat vs Street on revenues and EBITDA, respectively. However, DAUs came in in-line (US DAU 2% below), primarily from the impact of search referrals in the quarter. Meanwhile, 3Q guidance of 47-49% y/y growth implies modest deceleration with 475bps margin expansion. While RDDT didn’t provide concrete details on its renewal discussions with LLMs, the company noted a wide range of options to capture incremental value in 2027 and beyond. On the core advertising business, RDDT appears to be making steady progress on many key initiatives, including ad automation and advertiser diversification, which we believe are critical to sustain strong revenue growth over the next 4-6 quarters. Big picture – RDDT’s core advertising business is solid. That said, volatility in user growth due to external factors is likely to temper some excitement on the shares in the near-term. We have revised our FY27E revenues and EBITDA higher by 7% and 8%, respectively. We reiterate our neutral rating, and our revised PT of $170 is now based on 15x FY27E EV/EBITDA (vs. $200 and 22x FY26E/FY27E previously)."

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