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\*\*TL;DR:\*\*
RDDT is hovering around $160 as I'm writing this. The big brain institutions are giving reddit an average price target of $234. Earnings is on the 30th. AI/data is getting talked about and there \*could\* be an announcement about reddit locking in more AI revenue (yes, we're the product). If they don’t screw this up, this thing moves and I'll be able to make back my oil losses.
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\##First -- does Reddit suck?
Yes? Reddit feels more corporate now because it is. It's a business. Businesses like money. And yeah, the comment sections aren’t what they used to be.
But here’s the thing. We are not the "average" user. We are regarded apes with gambling addictions. There's a bunch of psychology about 100/10/1 percent of users and how they interact with a platform. I didn't read it, but someone commented about it and they (probably) read it.
Most people aren’t in the comments arguing with someone who is probably just a bot. They scroll. They lurk. They click. They leave.
They don’t care about “old Reddit” vs “new Reddit.” They’re not even writing comments. They’re just clicking and scrolling.
Those users are what actually matters for revenue. Not us. We're the "loss leaders" of reddit -- in more ways than one. If anything, a cleaner, \*more\* sanitized reddit is easier to monetize. Advertisers want that. AI companies want that.
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\##The Earnings Setup
RDDT is trading around $161.
Copy/Paste from MarketBeat:
\>According to the \*\*30 analysts' twelve-month price targets for Reddit, the average price target is $234.22.\*\* The highest price target for RDDT is $300.00, while the lowest price target for RDDT is $149.00. The average price target represents a forecasted upside of 45.58% from the current price of $160.89.
So either, these analysts are smoking stuff way nicer than what I can afford OR they know something.
I’m putting my rent money on #2.
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\##Boring stuff about ads
Not exciting, but it matters.
Reddit, via AI, has been improving ad targeting, cleaning up the platform, and making it less of a nightmare for advertisers. Basically, slowly turning into Facebook. Guess what's a super profitable company and part of FAANG? Facebook.
What's more useful than users scrolling and clicking ads? Scraping millions of comments to train AI to push targeted, niche ads.
Reddit makes money by selling our comments to AI companies. $$$ Advertisers pay reddit to show users highly targeted ads that were trained off the users comments. $$$ User (accidently) clicks on the ad. $$$
When reddit announces more data deals, or a big partnership, the price is going to moon. A lot.
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This isn’t even a “needs the perfect setup" kind of trade. It’s simple: expectations are reasonable. Sentiment is mixed.
So what happens when they deliver a revenue beat, give decent guidance, and drop even one bullish comment about AI or data? 🚀🚀🚀
$200+ isn't even a "omg squeeze" dream. It's literally what the big brain market makers think it'll be. RDDT doesn’t need to blow people out of the water. It just needs to show it’s \*slightly better than people think\*. That's it.
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Position: 500 shares & 10 180C 5/15. Not financial advice, I just like gambling