this post was submitted on 17 Mar 2025
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Reddit Rated Sell as Redburn Flags Risk From Google Algorithm (www.bloomberg.com)
submitted 1 month ago* (last edited 1 month ago) by misk@sopuli.xyz to c/technology@beehaw.org
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Archive: https://archive.is/2025.03.17-204842/https://www.bloomberg.com/news/articles/2025-03-17/reddit-rated-sell-as-redburn-flags-risk-from-google-algorithm

The user growth experienced by Reddit Inc. is a “gift” from Alphabet Inc.’s Google that may have led to excessive bullishness on the social-media company, according to analysts who have become the stock’s biggest bear.

Redburn Atlantic’s James Cordwell and Joseph Barker initiated coverage of Reddit with a sell recommendation, saying that while the financial performance since its initial public offering has been “stellar,” Wall Street is not appreciating the vulnerability of its growth to Google Search. Additionally, the analysts see user growth stalling in 2025.

“The reality, in our view, is that Reddit’s potential, breadth of appeal and thus value as a company are being overstated,” Cordwell and Barker wrote in a note published on Monday.

Shares fell 2% on Monday and is down 23% this year. It now has 15 buy-equivalent recommendations, seven holds and three sells among analysts tracking the stock, according to data compiled by Bloomberg. Cordwell and Barker’s price target of $75 is the lowest.

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[–] lvxferre@mander.xyz 2 points 1 month ago

Which is also how Digg v4 ended up, the brands as content submitters.

Exactly. Almost like Reddit decision makers know how Digg died, and yet they're unable to not follow its steps.