Key Takeaways
- Reddit shares fell another 25% today after its third-quarter report, leaving the stock 63% below its January high.
- B. Riley cut its price target on Reddit to $190 from $270 and kept its Buy rating, a target 95% above the current price.
- Reddit’s U.S. daily users fell 2% from a year earlier, and the company said its search referral traffic fell meaningfully during the quarter.
- B. Riley’s target needs only a below-average multiple, but it depends on earnings estimates that shrinking U.S. users and a Google renewal put at risk.
Reddit (RDDT) grew revenue 53% in the third quarter, and the stock still fell another 25% today. It now sits 63% below its January high, and B. Riley still sees 95% upside.
The users are the problem
U.S. daily active uniques grew 6% in the second quarter of 2026, down from 51% in the third quarter of 2024.
The third quarter made it worse. U.S. daily users fell 2% from a year earlier to 50.7 million, and Reddit told shareholders: “Our search referral traffic was down meaningfully in Q3, with the decline accelerating later in the quarter.”
Even the beat was smaller. Revenue of $895 million came in $25 million above the high end of guidance. In each of the three quarters before, the beat was $58 million to $80 million. Fourth-quarter revenue guidance of $1.00 billion to $1.03 billion also fell short of the $1.05 billion to $1.06 billion that analysts’ full-year estimates implied.
How B. Riley gets to $190
B. Riley analyst Naved Khan cut his target to $190 from $270 today and kept his Buy rating.
B. Riley’s path runs through earnings Reddit is already producing. Third-quarter net income was $283 million, 32% of revenue. At Thursday’s close, analysts expected $8.54 a share over the next twelve months, so $190 works out to 22x those earnings.
TIKR tracks 34 analysts on Reddit. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Reddit, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Reddit’s Analyst Ratings
Does $190 add up?
Thirty-four analysts cover Reddit, and their consensus target has slid from $252 in early February to $213, its low of the past year:
B. Riley’s $190 sits 11% below that.
Analysts kept raising their earnings estimates going into the report:
Fourth-quarter guidance came in below what those estimates assumed, and shrinking U.S. users don’t argue for raising them. I’d expect them to come down.
B. Riley’s case is strongest on the multiple. Reddit’s forward P/E fell to 15x at Thursday’s close, its low of the past year, against a 26x average and a 49x peak in January:
Today’s drop takes it lower still. So $190 asks for less than Reddit’s usual multiple.
Google holds the cards
The risk is Google. In the third quarter of 2025, management agreed that roughly half of Reddit’s traffic came from Google. BofA also called Reddit’s Google data-licensing renewal, due in the first quarter of 2027, an uncertainty.
My take: B. Riley’s math works, but it depends on earnings estimates made while U.S. users were still growing. I’d want to see them stop falling before counting on $190. U.S. daily users in the fourth-quarter report in early February are the next test, and the Google renewal comes after that.
So what is Reddit stock actually worth?
TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR’s valuation model and see what Reddit could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It’s free to use.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
