Truist Securities raised its price target on Reddit (NYSE: RDDT) to $275.00 from $270.00, while keeping a Buy rating on the shares. The move came in the wake of Reddit's fourth-quarter 2025 financial reporting, which Truist characterized as a "Classic Beat & Raise." The company also unveiled a new $1 billion share buyback program as part of its capital allocation update.
Reddit's reported results outpaced consensus expectations for the period. The platform recorded $726 million in revenue in the quarter, a 70% increase year-over-year, and adjusted EBITDA of $327 million, both figures that surpassed analysts' estimates. Truist highlighted the underlying drivers as broad-based strength in advertising demand across verticals, geographies and channels, anchored by robust user engagement and effective advertiser onboarding.
In Truist's view the operating performance - 70% top-line growth and a 43% AEBITDA margin in the quarter - places Reddit among the faster-growing and more profitable stories within the Digital Media segment. Truist also noted that despite the rising profile of generative AI, Reddit preserves a differentiated position as "the platform for authentic human conversations," supported by growth initiatives such as Search & Answers, Shopping Ads and Automation.
Other brokerages reacted to the quarter with differing assessments. Piper Sandler acknowledged that Reddit's revenue and adjusted EBITDA exceeded its internal forecasts by 9% and 17%, respectively, but nevertheless trimmed its price target to $205 while retaining an Overweight rating. Cantor Fitzgerald reduced its target to $170, citing concerns around user growth even as it flagged that revenue outpaced street estimates by 9%.
Conversely, several firms kept higher targets or reiterated positive ratings. Needham maintained a $300 price target and a Buy rating, calling out Reddit's 70% revenue growth as above expectations. Guggenheim increased its target to $255, pointing to strong usage metrics and anticipated advertising initiatives. Raymond James reiterated a Strong Buy rating with a $250 target, noting that both revenue and EBITDA beat street estimates.
The juxtaposition of upgrades and cuts among analysts underscores a split in sentiment about Reddit's medium-term trajectory. Market data show the stock traded slightly below its Fair Value and had declined roughly 16.21% over the prior week, reflecting near-term volatility even as the underlying quarterly results were strong.
For investors and market participants in digital advertising, social platforms and broader media, Reddit's quarter and the ensuing analyst reactions highlight two competing narratives: accelerating monetization and profitability on the one hand, and continued scrutiny over user growth and sustainability on the other. The $1 billion buyback adds a shareholder-return element to the story, even as analysts calibrate price targets across a wide range.