BofA raised the firm’s price target on Reddit (RDDT) to $180 from $99 and keeps a Neutral rating on the shares. Constructive channel checks for Reddit and a healthy direct response ad environment suggests another quarter of possibly accelerating ad revenue growth above guidance and estimates in Q4, the analyst tells investors. The firm is raising its Q4 revenue estimate by 3% and EBITDA forecast by 8% and while it says that AI optimism could support the multiple near-term, the firm adds that “history suggests multiple risk” as the firm points out that peers in the sector have had revenue multiple compression as post-IPO ad growth slowed.
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