Jim Cramer is Discussing These 10 Stocks Ahead of Q1 Earnings Season

4. Reddit Inc (NYSE:RDDT)

Number of Hedge Fund Investors: 52

Jim Cramer said the following about Reddit Inc (NYSE:RDDT) during a program on CBC:

“Reddit, all right, Steve Huffman did a really good job. People were really—they gunned that stock ahead of the quarter. There was no way you could ever beat the expectations. It’s now come down tremendously, and I think this is a good time to start a position. The stock was up six today. I don’t want to buy up six. If it comes in on Monday or Tuesday, buy a little.”

With about 100 million daily active users, Reddit Inc (NYSE:RDDT) remains one of the fastest-growing social media platforms in the world. While Facebook and Twitter show signs of maturing growth, Reddit Inc (NYSE:RDDT) still has huge upside potential as more and more people flock to Reddit discussion boards for authentic opinions and discussion. User input from millions of people on various topics freely accessible to anyone is Reddit Inc (NYSE:RDDT)’s moat. As of 2023, users posted 16 billion comments on the platform, according to the company. That’s why companies are flocking to pay money to Reddit to use its data to train their AI models.

However, Reddit expects a slowdown in revenue growth for Q1 2025 compared to its Q4 2024 pace. But with the stock already down over 50% from its highs, this concern seems well accounted for in its valuation. Reddit expects Q1 2025 EBITDA margins of about 25.3%.

Munro Global Growth Small & Mid Cap Fund stated the following regarding Reddit, Inc. (NYSE:RDDT) in its Q4 2024 investor letter:

“Key contributors to performance over the quarter were Reddit and AppLovin (see stock story on page 5). Reddit, Inc. (NYSE:RDDT) delivered a strong set of results, demonstrating impressive revenue growth and expanding operating margins. As the world grapples with misinformation and AI-generated content, we continue to view Reddit’s position as a unique platform hosting the largest volume of human conversations globally becoming increasingly valuable.”