20 Trending AI Stocks on Latest News and Ratings

Page 3 of 19

17. Reddit Inc (NYSE:RDDT)

Number of Hedge Fund Holders: 39

Reddit Inc (NYSE:RDDT) is an American social news aggregation, content rating, and forum social network. The company has been enhancing its AI capabilities by acquiring Memorable AI, following a partnership announcement with OpenAI, the creator of ChatGPT, which is backed by Microsoft (MSFT). These moves reflect its commitment to integrating advanced AI technologies into its offerings.

On October 9, 2024, Jefferies analysts initiated coverage of the stock with a “Buy” rating and a price target of $90. According to the firm, this valuation is based on $65 per share for Advertising and $25 per share for Data Licensing.

“RDDT is combining AI-driven product enhancements with a robust archive of contextual content to spur trial and engagement, resulting in recent user growth accelerating to the highest level in 2+ years,”

-Analysts said in a note.

The company’s growth can be attributed to its deeper integration with Google search and the launch of a faster Web platform. Investments in AI and machine learning have enhanced recommendation algorithms, further improving user experience and increasing logged-in users. Jefferies also notes how RDDT’s extensive database of user-generated content has garnered the interest of third-party developers of generative AI models, securing approximately $325 million in non-exclusive contract licensing revenue over the next three years.

“We believe expanding use-cases for Gen AI over time will attract new partnerships, resulting in additional high margin revenue streams and upside to consensus”.

-Jefferies analysts

Page 3 of 19