Latest Update: Reddit Stock Emerges as Top Stock Pick on App, Surpassing Nvidia, and Tesla

After its long-awaited launch to the public, Reddit shares hit the market with a lot of excitement. On the other hand, social media stocks may have even more wild trading sessions in the future.

Reddit stock went from worth $34 per share to worth more than $50 per share, a huge increase of 48%. Public, an app for investing popular among younger users, saw the excitement for itself.

Public.com CEO Jannick Malling said on Thursday’s “Last Call” on CNBC, “Even though it was only traded for a half day, it was the most bought stock of the day.” You’ve also seen growing excitement over the past few weeks, as shown by the rise in search traffic.

Malling believes Nasdaq’s plans to add Reddit options to its exchange on Monday could be a second trigger that gives the market even more energy.

The investing group on Reddit (r investing/Wallstreetbets) likes to use the risky tool of options trading.

Malling said, “Many options traders on Public today asked about Reddit and when we might be able to buy options on it.” “The question everyone has is whether they’re going to buy calls or puts.”

Arm Holdings, a British business that designs chips, and Instacart, a grocery delivery service, started in September. At first, they moved higher, but their stocks started falling. Both are now trading for much more than they were worth when they first came out.

A healthcare payments company called Waystar and a cybersecurity company called Rubrik are both private companies considering their 2024 services. Many big-name companies that want to go public, like the banking company Stripe and the tech company Databricks, can’t do it until at least 2025.

The Reddit stock has come a long way toward an IPO. People used to think of the company as an unimportant part of the internet, but now it’s one of the most important social media companies.

The company, which has been around for almost 19 years, filed paperwork to go public in late 2021. However, as the value of tech stocks started to drop, it put those plans on hold and focused on improving its finances. Reddit was worth about $6.4 billion when it went public, less than the $10 billion it was worth in a 2021 fundraising round.

It has more than 73 million daily r credit card users and over $800 million in sales, but it has yet to profit. Advertising brings in most of Reddit’s money, but the site also tries to make money in other ways. It opened a business last year to license data and recently said it had made its first big deal with Google.

Since Pinterest went public in 2019, Reddit has been the first social media company to go public since then. Even though Snap and Facebook are still bigger, Reddit has become more important to culture as its users analyze daily news stories like Kate Middleton’s changed family photo and the newest alien conspiracy theories.

Reddit users were often asked to buy shares in its initial public offering (IPO). It was a dangerous move that made Reddit, and its bankers want the stock to do well even more.

On March 15, Reddit said that the Federal Trade Commission is looking into “our sale, licensing, or sharing of user-generated content with third parties to train AI models.”

The investigation is not open to the public. However, Reddit said it was “unsurprised that the FTC has expressed interest” in the company’s AI data licensing methods. It doesn’t think it has “engaged in any unfair or deceptive trade practice.” In recent years, the availability of IPOs has dwindled as companies contend with increasing interest rates and tough market conditions. The forthcoming public debut of the stock market Reddit could spell good news for investment banks.

In March 2022, the Federal Reserve initiated a vigorous increase in its benchmark interest rate to counter emerging inflationary pressures. Subsequently, the benchmark federal funds rate climbed by 525 basis points over the following months, leading to sell-offs in major reddit stock market indexes and presenting challenges for newly listed publicly traded companies.