Baird starts Reddit with Neutral citing stock’s premium multiple

Baird initiated coverage of Reddit with a Neutral rating and $50 price target. The analyst says the company’s growth potential is offset by the stock’s valuation. Reddit shares are trading at premium multiples versus mean internet and social media comparables, and in-line with “high-quality/fast-growth” platforms, the analyst tells investors in a research note. The firm believes Reddit is a “unique online platform creating meaningful value” for advertisers from a growing user base and should resonate well with investors given its positive growth and margin trajectory.