TLDR
- Reddit (RDDT) fell ~10% on Thursday, hitting a low of $128.11
- CTO Christopher Slowe sold 9,500 shares worth ~$1.34M on March 23rd
- COO Jennifer Wong sold over 39,000 shares worth ~$6.6M across multiple transactions
- Analysts have flagged weak ad sales feedback and slowing user growth concerns
- RDDT is now down nearly 40% year-to-date, trading well below its 50 and 200-day moving averages
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Reddit’s stock fell sharply on Thursday as news of heavy insider selling from two of its top executives added to a rough year for the social media platform.
Reddit, Inc., RDDT
The stock dropped as much as 10.86%, touching a low of $128.11. Trading volume came in around 2.4 million shares, about 56% below the stock’s average daily volume of 5.5 million.
Chief Technology Officer Christopher Slowe sold 9,500 shares on March 23rd at an average price of $141.28, netting around $1.34 million. The sale cut his ownership stake by nearly 20%, leaving him with 38,413 shares.
COO Jennifer Wong was even more active. She sold 5,658 shares on March 18th at $143.42, and then sold an additional 33,507 shares on the same day at $143.41. Combined, the two transactions totalled roughly $5.6 million. Following the sales, Wong holds around 1.09 million shares worth over $156 million.
Both sales were disclosed through standard SEC filings.
Analyst Pressure Building
The insider selling isn’t the only weight on the stock. Analysts have flagged weak feedback from Reddit’s advertising sales efforts, and there are growing questions around slowing user engagement and traffic growth.
Cantor Fitzgerald cut its price target from $240 to $170, assigning a “neutral” rating. Goldman Sachs also trimmed its target from $236 to $206, likewise keeping a “neutral” rating.
Not everyone is turning bearish. Needham maintained a “buy” rating with a $300 price target, and the stock’s consensus rating among analysts remains “Moderate Buy” with an average target of $242.19.
That target is a long way from where RDDT is trading right now.
The stock’s 50-day moving average sits at $159.88 and its 200-day average at $200.15. RDDT is trading below both, and is down nearly 40% year-to-date.
Reddit does have a recent earnings beat to point to. In its last quarterly report on February 5th, the company posted EPS of $1.24 versus the consensus estimate of $0.96. Revenue came in at $725.61 million, up 69.7% year-over-year and ahead of the $665.80 million estimate.
By the Numbers
The company carries a market cap of roughly $24.6 billion, a price-to-earnings ratio of 49.14, and a beta of 2.40 — meaning it tends to move more sharply than the broader market.
Sell-side analysts collectively expect Reddit to post EPS of $1.12 for the current fiscal year.
The technical picture remains unfavorable. The stock currently carries a “Strong Sell” signal based on technical indicators.
The stock last closed at $139.63 before Thursday’s session.
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