Needham said there is more room for maneuver as Reddit, a platform for human-written posts, has become a big draw for netizens amid the boom in artificial intelligence. The investment firm has a “buy” rating on the social media name. He also has a $300 price target, implying a 50% upside from Thursday’s closing price. “RDDT’s core assets will increase in value over time because they are 100% human interaction and information at scale, which gives us a competitive advantage in an algorithm-proliferated environment,” analyst Laura Martin said in a note to clients on Friday. “RDDT provides a layer of human authentication and advice that many consumers require before following purchase or life advice from LLMs or algorithms.” The use of generative AI tools such as ChatGPT has exploded in recent years. A recent Pew Research Center report found that nearly half of U.S. adults report using AI chatbots, a significant increase from the number of people who reported using those tools in 2024. What’s more, according to the same report, approximately one in four survey participants said they currently use gen-AI tools on a daily basis. But as more people turn to AI bots, it may become more difficult to find human-authored content, making Reddit a valuable source of genuine non-AI insights. Martin said this should further increase the value of the company’s stock. Needham’s call echoes the consensus on the street. Of the 29 analysts covering Reddit, 19 rate the stock as a buy or strong buy, according to LSEG data. Reddit stock has risen 43% over the past three months, significantly outperforming the broader market.
