Reddit Inc. (NASDAQ: RDDT) is strongly positioned to extend its gains further over the next few weeks, according to JPMorgan senior analyst Doug Anmuth.
Reddit shares have already rallied some 40% since early April, but an upbeat quarterly release the forum social media platform posted this week will sustain momentum moving forward, Anmuth says.
In the first quarter, the NYSE-listed firm earned 13 cents on a per-share basis (adjusted) – well above the 2 cents per share that experts had forecast.
At $392 million, RDT’s revenue also topped Street estimates by about $22 million in its fiscal Q1.
Reddit shares have upside to $145 in 2025
JPMorgan recommends owning Reddit stock at current levels as the San Francisco-headquartered firm continues to grow its daily active users at an accelerated pace.
DAUs were up another 31% in Q1, which brought sufficient confidence to Doug Anmuth in raising his price target on RDT shares to $145, since a fast-growing user base is attracting significant ad dollars to Reddit in 2025.
“Reddit continues to execute well and capture share of advertiser budgets,” he told clients in a research note this week.
Note that Reddit shares are down some 45% versus their year-to-date high at the time of writing.
RDT is well-positioned to grow its profit and revenue
According to the JPMorgan analyst, shares of the social media company could extend gains as its management continues to introduce new features like the AI-enabled Reddit Answers.
All in all, the San Francisco-based firm is strongly positioned to continue growing its profit and revenue, which may help unlock significant further upside in its share price in the months ahead.
Note that Doug Anmuth’s upwardly revised price target on RDT stock translates to about 20% upside from current levels.
However, the social news aggregation platform does not currently pay a dividend and is, therefore, not a suitable pick for income investors in 2025.
Reddit issued upbeat guidance for its fiscal Q2
Investors could also take heart in the fact that Reddit, earlier this week, issued upbeat guidance for the current quarter at a time when tariffs and the related macro uncertainty are keeping others cautious at best.
RDT expects its revenue to fall in the range of $410 million to $430 million in Q2, handily above the $396 million that analysts had called for.
More importantly, the company’s chief executive, Steve Huffman, said in his letter to shareholders that Reddit is well-positioned to weather the ongoing macro uncertainty, adding, “We’ve grown through challenging times before – people need connection and information just as much in uncertain times.”
Note that other Wall Street firms agree with JPM on RDT shares, given the consensus rating on Reddit stock currently sits at “overweight”.
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