Citizens has reaffirmed its Market Outperform rating on Reddit (NYSE: RDDT) and kept its $300.00 price target, holding to a valuation that implies roughly 112% upside from Reddit's then-current price of $141.74. The firm noted that InvestingPro's Fair Value assessment indicates the stock is modestly undervalued at present.
On the user-engagement front, Citizens flagged that January marked the sixth consecutive month of year-over-year decline in global time spent on the platform. In the United States specifically, time spent contracted by 10.5% year-over-year in January, a deterioration of 170 basis points from December's performance.
Global monthly active users (MAU) also declined year-over-year for the fifth straight month, according to Citizens. The firm did point out, however, that the year-over-year comparison windows will become less challenging in future months, which could influence sequential trends in MAU.
Despite those headwinds in time-on-site and MAU, several traffic measures showed improvement. Citizens reported that global website visits grew 14.4% year-over-year in January, while U.S. visits rose 6.3% year-over-year. Both gains represented acceleration relative to December's growth rates, indicating improved open-web exposure.
Citizens emphasized that its metric set differs from Reddit's own disclosures. The firm focuses on open web exposure when measuring visits and engagement, whereas Reddit has indicated plans to stop differentiating between logged-in and logged-out users as the product experience converges. That change in Reddit's public reporting complicates direct comparisons between the company's internal user tallies and third-party measures of web traffic.
Separately, Reddit reported strong financial results for the fourth quarter of 2025. Revenue for the quarter reached $725.6 million, up 70% year-over-year, while adjusted EBITDA rose 112% from the prior year. Those results prompted several analyst reactions: Needham kept a Buy rating with a $300 price target, Truist Securities raised its target to $275 and announced a $1 billion share buyback program, Piper Sandler trimmed its target to $205 citing valuation concerns, and Cantor Fitzgerald lowered its target to $170 over user growth worries even as it noted Reddit's revenue beat street estimates by 9%.
The range of analyst responses underscores mixed sentiment in the market despite Reddit's strong revenue and improving profitability metrics. Citizens' maintained rating and target reflect a view that valuation upside exists, while user engagement indicators and changes in reporting practices add uncertainty to the near-term narrative.
What to watch next
- How Reddit's change in reporting logged-in versus logged-out usage affects visibility into user trends.
- Whether improving open-web visit metrics translate into stabilization of time spent and MAU in coming months.
- The market response to announced capital actions such as share buybacks and how they interact with valuation concerns.