Analyzing Reddit (RDDT) & Its Competitors

Reddit (NYSE:RDDT) is one of 151 public companies in the “Data processing & preparation” industry, but how does it weigh in compared to its peers? We will compare Reddit to similar businesses based on the strength of its institutional ownership, profitability, earnings, analyst recommendations, risk, dividends and valuation.

Earnings and Valuation

This table compares Reddit and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Reddit	$1.30 billion	-$484.28 million	-24.53
Reddit Competitors	$938.76 million	$7.99 million	25.85

Reddit has higher revenue, but lower earnings than its peers. Reddit is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Reddit and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Reddit	-37.25%	-24.71%	-22.52%
Reddit Competitors	-159.13%	-1,792.45%	-8.86%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Reddit and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reddit	1	8	12	1	2.59
Reddit Competitors	869	4584	6141	157	2.48

Reddit currently has a consensus target price of $175.45, suggesting a potential downside of 7.47%. As a group, “Data processing & preparation” companies have a potential upside of 5.83%. Given Reddit’s peers higher probable upside, analysts plainly believe Reddit has less favorable growth aspects than its peers.

Institutional and Insider Ownership

45.4% of shares of all “Data processing & preparation” companies are held by institutional investors. 20.4% of shares of all “Data processing & preparation” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

About Reddit

Reddit, Inc. operates a website that organizes digital communities. It organizes communities based on specific interests that enable users to engage in conversations by sharing experiences, submitting links, uploading images and videos, and replying to one another. The company was founded in 2005 and is headquartered in San Francisco, California.