By Angela Palumbo
Reddit stock continued its slide Friday, but that didn't stop Piper Sandler from staying optimistic about the online social platform.
Piper Sandler analyst Thomas Champion increased his price target on Reddit to $220 from $210 on Friday while maintaining an Overweight rating.
The boosted price target comes despite a number of factors weighing on the stock lately.
Reddit reported on Feb. 12 that fourth-quarter daily active unique visitors rose less than Wall Street expected. Late in the quarter, the company experienced "some volatility from Google search triggered by a periodic algorithm change," Chief Executive Officer Steven Huffman said on the earnings call.
While data did show a decline in feed audience in December, "this bounced back in January," Champion wrote.
He isn't alone in his bullishness. Of the 24 analysts surveyed by FactSet, 15 say the stock is a Buy, eight say it's a Hold, and one rates it Sell. Their average price target on the stock is $209.57.
Investors continue to remain skeptical, though. The stock slid 6.8% on Friday to $163.56. Shares are now down 27% from their all-time closing high of $225.23 on Feb. 7.
Reddit stock has also faced increased pressure after breaking through its 50-day moving average on Thursday. It continued to trade roughly $20 below that key level on Friday.
When stocks trade below that average, it's one sign to investors that a continued downward trend is potentially in the cards.
News on Thursday that the Federal Trade Commission had launched a public inquiry into censorship by technology platforms didn't help either. Reddit and other social media stocks took a hit: Meta Platforms dropped 1.3% and Snapchat parent Snap declined 0.9% on Thursday.
Write to Angela Palumbo at angela.palumbo@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
February 21, 2025 14:42 ET (19:42 GMT)
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