Reddit Inc. faces competitive pressure as Digg relaunches
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 30 2025
0mins
Should l Buy RDDT?
Source: Fool
Reddit Inc. (RDDT) has seen its stock price decline by 5.13%, hitting a 20-day low amid a challenging market environment where the Nasdaq-100 is down 1.73% and the S&P 500 is down 1.47%.
The recent relaunch of Digg, which attracted 67,000 users during its invite-only phase, poses a competitive threat to Reddit. This surge in user interest for Digg indicates a potential shift in market dynamics, as users may explore alternative platforms for community engagement. Additionally, despite Reddit receiving an A+ EPS revision grade from analysts, the stock's performance has been negatively impacted by the competitive landscape.
As competition intensifies, Reddit may need to enhance its user engagement strategies to retain its user base and mitigate the effects of emerging rivals like Digg. The market's reaction reflects concerns over Reddit's ability to maintain its growth trajectory in the face of increasing competition.
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Analyst Views on RDDT
Wall Street analysts forecast RDDT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for RDDT is 260.00 USD with a low forecast of 207.00 USD and a high forecast of 325.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
22 Analyst Rating
14 Buy
8 Hold
0 Sell
Moderate Buy
Current: 151.050
Low
207.00
Averages
260.00
High
325.00
Current: 151.050
Low
207.00
Averages
260.00
High
325.00
About RDDT
Reddit, Inc. operates a social platform, Reddit. Reddit is a community of communities. It is built on shared interests, passion, and trust and is home to open and authentic conversations on the Internet. Reddit is a global, digital city where anyone in the world can join a community to learn from one another, engage in authentic conversations, explore passions, research new hobbies, exchange goods and services, create new communities and experiences, share a few laughs, and find belonging. Reddit has thousands of communities, endless conversations, and authentic human connections. Communities on Reddit are organized based on specific interests and are called subreddits. Reddit offers real-time access to evolving and dynamic topics, such as sports, movies, news, fashion, and the latest trends. On Reddit, users can submit, vote, and comment on the topics they care about. It has approximately 100,000+ active communities and approximately 101+ million daily active visitors.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strategic Buyback Investment: Reddit announced a $1 billion share repurchase program, demonstrating confidence in future growth while also committing to creating shareholder value, further solidifying its market position.
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- Earnings Beat: The company achieved earnings per share of $1.24, significantly surpassing the analyst estimate of $0.94, demonstrating a notable improvement in profitability that may attract more investor interest.
- Stock Buyback Program: Reddit announced a $1 billion stock repurchase program with no set expiration date, aimed at enhancing shareholder value and boosting market confidence in the company's future prospects.
- Market Volatility Reaction: Despite an initial 9% surge in stock price on Friday morning, shares reversed course to decline nearly 5%, reflecting market caution towards high-volatility stocks, which could influence short-term investor decisions.
See More
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- Revenue Surge: The company achieved revenue of $726 million, a 70% year-over-year increase, with advertising revenue rising by 75%, demonstrating Reddit's growing competitiveness in the advertising market and potential for further market share expansion.
- Strong User Growth: Daily Active Uniques (DAUq) rose by 19% to 121.4 million, with international growth (up 28%) outpacing the U.S., showcasing Reddit's appeal and potential for expansion on a global scale.
- Concerns Over Slowing Growth: Despite strong earnings, growth in U.S. logged-in users slowed to 5%, raising market concerns about saturation in Reddit's most profitable market, while the CEO's announcement to stop reporting the split between logged-in and logged-out users may mask deceleration in high-value user growth.
See More
