Reddit (RDDT) shares climbed to a record high Monday after analysts from Morgan Stanley upgraded the social media stock, citing the company’s “multiple levers” for potential growth heading into 2025.
The analysts said they “have been wrong on the sidelines” about the stock’s growth since its initial public offering (IPO) earlier this year. They lifted their price target to $200 from $70 and upgraded the stock to “overweight” from “equal-weight,” highlighting new tools and products that could help grow Reddit’s user base and advertising revenue over the next year.
“In effect, RDDT is shipping engagement and ad products rapidly and has multiple levers to drive outsized growth,” the analysts wrote Sunday.
Reddit’s daily active users(DAUs) have grown about 20% faster than Morgan Stanley’s model had projected, and the analysts said they expect Reddit’s user base to keep growing along with the time users spend on the platform. They noted features like improved search …