RDDT - Reddit

Bullish on growing user base, advertising growth, and new AI data licensing business model. Reddit's authentic human content is increasingly valuable for AI pre-training, post-training, and grounding. CEO stated Reddit is the number one cited source across LLMs.

One host calls Reddit a great business with an amazing valuation. They dismiss bear cases as being politically motivated rather than fundamental.

Host likes both Meta and Reddit. Both getting hurt in current market. Questions how people are treating advertising companies so poorly. Humans are buyers of products and will spend more time on social media if laid off. Next trillion-dollar industry will be selling to agents.

Host mentions Reddit as a free cash flow generative business that should be in the S&P 500. Notes it's near the cusp of eligibility at $22.7B market cap.

Host likes Reddit for the same reasons as Meta — network effects and data. He calls it 'a younger version of Meta' and holds it in his portfolio.

Up 4%, mentioned as one of the host's favorite non-AI dependent software/digital platform stocks. Growing fast, would command a high acquisition price.

Reddit is growing revenue at ~70% YoY with 91.5% gross margins, $311M quarterly free cash flow (new high), and consistently beating Wall Street revenue estimates by 8-17%. It trades at only 21x forward FCF despite consistent upside surprises. The host emphasizes its $1.4B cash balance, minimal debt, and expanding international user base with growing monetization per user.

Tanner bought Reddit at ~$167 as a swing trade, writing covered calls to lower his cost base to ~$156. He believes the 66% YoY growth and cheap forward valuation make it compelling. Steve is more skeptical about Reddit's moat but acknowledges the numbers are strong.

Host is bullish on Reddit, citing the Shopify partnership delivering $12.52 return per dollar spent on ads (2x meta plan average), the ability to charge more as the platform improves (currently ~1/10 of Meta's rates), and its role as an advertising platform that helps businesses make money.

Host likes Reddit stock, calling it an 'ad revenue machine' that's ramping up quickly. Notes the business is separate from the platform's user sentiment, and they're effectively using AI in their ad platform.