Reddit’s (RDDT) AI Search Push and Ad Momentum Support Bullish Wall Street View

Reddit, Inc. (NYSE:RDDT) is one of the 14 AI Stocks Making Headlines on Wall Street: Qualcomm, Microsoft, and More.

On June 2, Citizens analyst Andrew Boone reiterated a Market Outperform rating on Reddit, Inc. (NYSE:RDDT) with a $240.00 price target. Boone has particularly defended Reddit’s premium valuation, stating how the company boasts major drivers driving near-term outperformance.

Reddit last closed at $177.85, which implies shares trade for 16.5x our 2027E EBITDA of $2.0B and 25.4x our 2027E GAAP EPS of $7.01. We maintain our Market Outperform rating. Our $240 price target is based on ~34x our 2027E GAAP EPS of $7.01.

From its significant ad momentum to new product launches such as Reddit Shopping and Max, many factors justify the stock’s valuation. The firm also noted how Reddit Answers, an AI-powered search tool on Reddit, has been modernizing the search experience for its users.

Reddit’s (RDDT) AI Search Push and Ad Momentum Support Bullish Wall Street View

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The firm believes that Reddit will continue to materially outperform estimates near-term.

Reddit, Inc. (NYSE:RDDT) is a social media platform that leverages AI to strengthen search functionality and improve user engagement.

While we acknowledge the risk and potential of RDDT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RDDT and that has 10,000% upside potential, check out our report about the cheapest AI stock.

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