Reddit Hailed As 'AI-Learning Goldmine' Despite Buying Pressure - Reddit (NYSE:RDDT)

Reddit Inc. RDDT has been riding a wave of optimism, with its stock surging over 125% in the past six months. While a modest 10% dip over the last month suggests some cooling, the bullish technical and fundamental indicators are hard to ignore.

Here's why investors are buzzing about the platform that Reddit users are hailing as an "AI-learning goldmine."

Reddit’s Stock Chart Suggests Buying Pressure

Chart created using Benzinga Pro

Reddit's stock, trading at $166.47, shows mixed short-term signals but undeniable long-term strength. The stock hovers slightly below its eight and 20-day SMAs (simple moving averages), a potential caution for short-term traders.

However, its MACD (moving average convergence/divergence) indicator at 7.62 flashes bullish, and a 50-day SMA of $141.28 underscores the stock's upward trajectory. Coupled with an RSI (relative strength index) of 56.04, Reddit appears to be consolidating for its next move higher.

Reddit’s Data-Fueled Partnership With Google

Fundamental bulls are taking a long-term view, bolstered by Reddit's collaboration with Alphabet Inc‘s GOOGL GOOG Google. According to one Reddit user, Google's recent algorithm update has strategically elevated Reddit's visibility in search results, driving more traffic to its forums.

Even more compelling, Reddit's treasure trove of human-driven responses has attracted interest for training large language models (LLMs), with lucrative data-scraping deals adding to its revenue streams.

Revenue Streams, Global Expansion

Reddit reported a 16% increase in revenue per user and 50% user base growth, highlighting its ability to scale while monetizing effectively. Advertising revenue is climbing, with improved margins leading to positive EPS.

With plans to launch paid subreddit subscriptions and "Reddit Answers," the company is building additional revenue streams while keeping its community engaged.

Looking ahead, Reddit's 2025 expansion into 35 countries promises to bring millions of new users into the fold. This growth potential, paired with its operational efficiency and sticky user base, has investors eyeing the company's future with optimism.

A Future Worth Betting On?

Reddit user Overlord1317, captures the sentiment of bullish investors succinctly: "Reddit seems like the last of the ‘gigantic user base' social media sites to buy in the nascent stages."

With its AI-friendly dataset, addictiveness, and synergy with Google, the platform is positioning itself as a formidable player in tech's next wave.

While Reddit faces short-term fluctuations, its long-term outlook remains strong.

For investors, this "AI-learning goldmine" could indeed be one of the most undervalued plays in social media.

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