Reddit's Stock Surges to New 52-Week High Amid Q2 Earnings Surprise

Reddit Inc. (RDDT) shares surged to a new 52-week high, driven by robust Q2 earnings that surpassed analyst expectations and prompted price target upgrades. Revenue increased 78% YoY to $499.6 million, while adjusted EBITDA reached $167 million for a 33% margin. Wall Street analysts highlighted the company's successful monetization strategy and future growth potential, with a momentum score of 97.62 and a value score of 6.81.

Title: Reddit Inc. (RDDT) Shares Surge to New 52-Week High Amid Strong Q2 Earnings

Reddit Inc. (RDDT) shares surged to a new 52-week high, driven by robust Q2 earnings that surpassed analyst expectations and prompted price target upgrades. Revenue increased 78% year-over-year (YoY) to $499.6 million, while adjusted EBITDA reached $167 million for a 33% margin. Wall Street analysts highlighted the company's successful monetization strategy and future growth potential, with a momentum score of 97.62 and a value score of 6.81.

The stock's recent performance has been remarkable, with a 336% increase over the past year and a 40% year-to-date return. This surge can be attributed to the company's strong Q2 earnings report, which saw revenue grow by 78% and net income rise to $89 million from a $10 million net loss in the same quarter a year ago. The earnings report also included an impressive 90.8% gross margin, up from 89.5%, indicating the company's profitability [1].

The earnings report was well-received by Wall Street analysts, with 13 analysts boosting their price targets for Reddit stock. Notably, Truist increased its target by $65 to $225 per share, Morgan Stanley by $60 to $230 per share, and Raymond James by $50 to $225 per share. The highest price target came from B. Riley, which lifted its outlook by $15 to $235 per share [1].

Despite the strong performance, investors should be cautious about the stock's valuation. Reddit is currently trading at a high multiple of 98 times earnings and 120 times forward earnings, which may indicate overvaluation. However, the company's long-term prospects remain promising, with analysts anticipating revenue growth of 31.8% annually over the next three years [2].

Moreover, institutional investors are showing confidence in Reddit's future prospects. Mitsubishi UFJ Asset Management, for instance, increased its stake in Reddit by 44.1%, acquiring an additional 37,407 shares, reaching a total of 122,141 shares valued at approximately $12.81 million [3]. This increase in institutional ownership further underscores the belief in Reddit's growth potential.

In conclusion, Reddit Inc. shares have surged to a new 52-week high on the back of strong Q2 earnings and analyst upgrades. While the stock may be overvalued in the short term, its long-term prospects remain promising. Investors should carefully consider the company's valuation and growth prospects before making any investment decisions.

References:
[1] https://www.investing.com/analysis/reddit-stock-nears-alltime-high--can-it-keep-rising-200665269
[2] https://finance.yahoo.com/news/reddit-rddt-sees-q2-2025-172308852.html
[3] https://www.marketbeat.com/instant-alerts/filing-mitsubishi-ufj-asset-management-co-ltd-purchases-37407-shares-of-reddit-inc-nyserddt-2025-08-12/