Reddit (NYSE: RDDT) is a social media company that generates most of its revenue from advertising. The company joined the S&P 500 before the opening of trading on August 18, 2026, replacing AvalonBay Communities. Inclusion in the index means that funds designed to track the S&P 500 may need to own Reddit shares.
On August 21, 2026, Morgan Stanley (NYSE: MS) maintained its Overweight rating on Reddit and reduced its price target to $210 from $240. An Overweight rating indicates that the firm expects the stock to outperform its coverage universe or a relevant benchmark over its investment horizon.
Reddit’s Q2 2026 results provided support for the positive long-term view. Revenue grew 61.1% year over year to $804.9 million, marking the company’s eighth consecutive quarter of revenue growth above 60%. The company reported net income of $253 million and diluted earnings per share of $1.25. Adjusted EBITDA rose 106% year over year to $343 million.
Reddit shares closed at $150.31 on August 20, 2026. Morgan Stanley’s $210 target was above that price, but a price target is an analyst estimate rather than a guarantee of future returns.
Despite strong business growth, Reddit shares have experienced substantial volatility in 2026. Investors have focused on the sustainability of advertising growth, changes in search-engine traffic, the company’s artificial-intelligence data-licensing opportunities, and the valuation applied to high-growth technology companies.
