Reddit (RDDT) stock dropped 4.29% to $247.83 on January 14, reversing momentum from the previous day's surge as the company faced new regulatory mandates and participated in a broader market selloff driven by inflation concerns.
- The decline follows a 6.11% surge on January 13, with the current selloff occurring alongside the S&P 500 dropping 0.98% and the NASDAQ falling 1.47%.
- A new regulatory mandate requires major social media platforms, including Reddit, to display mental health warnings to users, which analysts believe could negatively impact engagement metrics.
- Analysts are scrutinizing fourth-quarter ad spending trends, while the stock maintains a premium valuation with a forward P/E ratio of 65.84, significantly exceeding the industry average of 24.73.