RDDT Fundamental Analysis - REDDIT INC-CL A

Fundamental Rating

We assign a fundamental rating of 5 out of 10 to RDDT. RDDT was compared to 71 industry peers in the Interactive Media & Services industry. While RDDT has a great health rating, its profitability is only average at the moment. RDDT shows excellent growth, but is valued quite expensive already.

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1. Profitability

1.1 Basic Checks

RDDT had positive earnings in the past year.

In the past year RDDT had a positive cash flow from operations.

RDDT had negative earnings in each of the past 5 years.

In the past 5 years RDDT reported 4 times negative operating cash flow.

1.2 Ratios

RDDT's Return On Assets of 4.80% is fine compared to the rest of the industry. RDDT outperforms 70.42% of its industry peers.

RDDT has a Return On Equity of 5.27%. This is in the better half of the industry: RDDT outperforms 70.42% of its industry peers.

Looking at the Return On Invested Capital, with a value of 1.14%, RDDT is in line with its industry, outperforming 59.15% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	4.8%
ROE	5.27%
ROIC	1.14%

ROA(3y)-12.11%

ROA(5y)-11.08%

ROE(3y)-13.26%

ROE(5y)-12.17%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

RDDT's Profit Margin of 8.07% is fine compared to the rest of the industry. RDDT outperforms 78.87% of its industry peers.

Looking at the Operating Margin, with a value of 2.25%, RDDT is in line with its industry, outperforming 56.34% of the companies in the same industry.

RDDT's Gross Margin of 90.82% is amongst the best of the industry. RDDT outperforms 90.14% of its industry peers.

RDDT's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	2.25%
PM (TTM)	8.07%
GM	90.82%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y2.1%

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RDDT is destroying value.

RDDT has more shares outstanding than it did 1 year ago.

RDDT has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

An Altman-Z score of 64.56 indicates that RDDT is not in any danger for bankruptcy at the moment.

Looking at the Altman-Z score, with a value of 64.56, RDDT belongs to the top of the industry, outperforming 97.18% of the companies in the same industry.

There is no outstanding debt for RDDT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	64.56

ROIC/WACC0.13

WACC9.1%

2.3 Liquidity

RDDT has a Current Ratio of 12.46. This indicates that RDDT is financially healthy and has no problem in meeting its short term obligations.

RDDT has a Current ratio of 12.46. This is amongst the best in the industry. RDDT outperforms 95.77% of its industry peers.

A Quick Ratio of 12.46 indicates that RDDT has no problem at all paying its short term obligations.

RDDT has a Quick ratio of 12.46. This is amongst the best in the industry. RDDT outperforms 95.77% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	12.46
Quick Ratio	12.46

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

RDDT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 116.80%, which is quite impressive.

RDDT shows a strong growth in Revenue. In the last year, the Revenue has grown by 64.12%.

RDDT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 38.93% yearly.

EPS 1Y (TTM)116.8%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%101.59%

Revenue 1Y (TTM)64.12%

Revenue growth 3Y38.93%

Revenue growth 5YN/A

Sales Q2Q%61.49%

3.2 Future

Based on estimates for the next years, RDDT will show a very strong growth in Earnings Per Share. The EPS will grow by 34.76% on average per year.

Based on estimates for the next years, RDDT will show a very strong growth in Revenue. The Revenue will grow by 32.72% on average per year.

EPS Next Y116.04%

EPS Next 2Y51.77%

EPS Next 3Y34.76%

EPS Next 5YN/A

Revenue Next Year44.1%

Revenue Next 2Y35.96%

Revenue Next 3Y32.72%

Revenue Next 5YN/A

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 226.85, the valuation of RDDT can be described as expensive.

RDDT's Price/Earnings is on the same level as the industry average.

RDDT is valuated expensively when we compare the Price/Earnings ratio to 26.32, which is the current average of the S&P500 Index.

The Price/Forward Earnings ratio is 57.06, which means the current valuation is very expensive for RDDT.

The rest of the industry has a similar Price/Forward Earnings ratio as RDDT.

RDDT's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.19.

		Industry Rank	Sector Rank
PE	226.85
Fwd PE	57.06

4.2 Price Multiples

RDDT's Enterprise Value to EBITDA ratio is in line with the industry average.

Compared to the rest of the industry, the Price/Free Cash Flow ratio of RDDT is on the same level as its industry peers.

		Industry Rank	Sector Rank
P/FCF	78.85
EV/EBITDA	413.18

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates RDDT does not grow enough to justify the current Price/Earnings ratio.

RDDT's earnings are expected to grow with 34.76% in the coming years. This may justify a more expensive valuation.

PEG (NY)1.95

PEG (5Y)N/A

EPS Next 2Y51.77%

EPS Next 3Y34.76%

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5. Dividend

5.1 Amount

No dividends for RDDT!.

		Industry Rank	Sector Rank
Dividend Yield	N/A

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REDDIT INC-CL A

NYSE:RDDT (6/17/2025, 8:13:09 PM)

After market: 132.5 -1.34 (-1%)

133.84

+7.64 (+6.05%)

Chartmill FA Rating

GICS SectorCommunication Services

GICS IndustryGroupMedia & Entertainment

GICS IndustryInteractive Media & Services

Earnings (Last)05-01 2025-05-01/amc

Earnings (Next)08-04 2025-08-04

Inst Owners84.82%

Inst Owner Change3.86%

Ins Owners1.06%

Ins Owner Change-52.17%

Market Cap24.70B

Analysts78

Price Target160.33 (19.79%)

Short Float %16.2%

Short Ratio2.36

Dividend

		Industry Rank	Sector Rank
Dividend Yield	N/A

Yearly DividendN/A

Dividend Growth(5Y)N/A

DPN/A

Div Incr Years0

Div Non Decr Years0

Ex-DateN/A

Surprises & Revisions

EPS beat(2)2

Avg EPS beat(2)266.49%

Min EPS beat(2)40.18%

Max EPS beat(2)492.8%

EPS beat(4)4

Avg EPS beat(4)236.68%

Min EPS beat(4)40.18%

Max EPS beat(4)492.8%

EPS beat(8)N/A

Avg EPS beat(8)N/A

EPS beat(12)N/A

Avg EPS beat(12)N/A

EPS beat(16)N/A

Avg EPS beat(16)N/A

Revenue beat(2)2

Avg Revenue beat(2)3.71%

Min Revenue beat(2)3.47%

Max Revenue beat(2)3.96%

Revenue beat(4)4

Avg Revenue beat(4)6.33%

Min Revenue beat(4)3.47%

Max Revenue beat(4)9.17%

Revenue beat(8)N/A

Avg Revenue beat(8)N/A

Revenue beat(12)N/A

Avg Revenue beat(12)N/A

Revenue beat(16)N/A

Avg Revenue beat(16)N/A

PT rev (1m)-3.57%

PT rev (3m)-24.8%

EPS NQ rev (1m)5.06%

EPS NQ rev (3m)41.91%

EPS NY rev (1m)0%

EPS NY rev (3m)10.01%

Revenue NQ rev (1m)0.29%

Revenue NQ rev (3m)4.7%

Revenue NY rev (1m)0.21%

Revenue NY rev (3m)1.95%

Valuation

		Industry Rank	Sector Rank
PE	226.85
Fwd PE	57.06
P/S	17.04
P/FCF	78.85
P/OCF	77.76
P/B	11.14
P/tB	11.48
EV/EBITDA	413.18

EPS(TTM)0.59

EY0.44%

EPS(NY)2.35

Fwd EY1.75%

FCF(TTM)1.7

FCFY1.27%

OCF(TTM)1.72

OCFY1.29%

SpS7.86

BVpS12.02

TBVpS11.66

PEG (NY)1.95

PEG (5Y)N/A

Profitability

		Industry Rank	Sector Rank
ROA	4.8%
ROE	5.27%
ROCE	1.45%
ROIC	1.14%
ROICexc	8.61%
ROICexgc	11.01%
OM	2.25%
PM (TTM)	8.07%
GM	90.82%
FCFM	21.61%

ROA(3y)-12.11%

ROA(5y)-11.08%

ROE(3y)-13.26%

ROE(5y)-12.17%

ROIC(3y)N/A

ROIC(5y)N/A

ROICexc(3y)N/A

ROICexc(5y)N/A

ROICexgc(3y)N/A

ROICexgc(5y)N/A

ROCE(3y)N/A

ROCE(5y)N/A

ROICexcg growth 3YN/A

ROICexcg growth 5YN/A

ROICexc growth 3YN/A

ROICexc growth 5YN/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y2.1%

GM growth 5YN/A

F-Score8

Asset Turnover0.59

Health

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Debt/EBITDA	0
Cap/Depr	27.59%
Cap/Sales	0.3%
Interest Coverage	250
Cash Conversion	655.44%
Profit Quality	267.82%
Current Ratio	12.46
Quick Ratio	12.46
Altman-Z	64.56

F-Score8

WACC9.1%

ROIC/WACC0.13

Cap/Depr(3y)62.94%

Cap/Depr(5y)85.65%

Cap/Sales(3y)0.87%

Cap/Sales(5y)0.89%

Profit Quality(3y)N/A

Profit Quality(5y)N/A

High Growth Momentum

Growth

EPS 1Y (TTM)116.8%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%101.59%

EPS Next Y116.04%

EPS Next 2Y51.77%

EPS Next 3Y34.76%

EPS Next 5YN/A

Revenue 1Y (TTM)64.12%

Revenue growth 3Y38.93%

Revenue growth 5YN/A

Sales Q2Q%61.49%

Revenue Next Year44.1%

Revenue Next 2Y35.96%

Revenue Next 3Y32.72%

Revenue Next 5YN/A

EBIT growth 1Y104.95%

EBIT growth 3YN/A

EBIT growth 5YN/A

EBIT Next Year205.43%

EBIT Next 3Y60.52%

EBIT Next 5YN/A

FCF growth 1Y354.39%

FCF growth 3YN/A

FCF growth 5YN/A

OCF growth 1Y395.64%

OCF growth 3YN/A

OCF growth 5YN/A

REDDIT INC-CL A (RDDT) Stock Fundamental Analysis

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

More info and screens

2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

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3. Growth

3.1 Past

3.2 Future

3.3 Evolution

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4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

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5. Dividend

5.1 Amount

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