Reddit Inc.'s shares have experienced a steep decline of 50% since their February peak, largely due to disappointing earnings and a challenging landscape dominated by larger competitors like Google and Meta. The company's traffic has suffered from recent algorithm changes, prompting an increase in short interest. Despite a slight uptick in share value, analysts warn of overvaluation and persistent losses, reflecting broader concerns in the tech sector as the Nasdaq 100 continues to decline. Experts suggest a cautious approach to investing, citing uncertainty in the market.
"Reddit shares were up about 1% in early trading Friday, but are still considered super overvalued. Despite strong growth, the company isn’t profitable yet."
"The gloomy sentiment around Reddit has not lessened after its shares plummeted 50% since February, pressured by a broader downturn in tech stocks."
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