Social media platform Reddit is planning to launch its long-awaited initial public offering (IPO) in March. Hedgeye Communications analyst Billy Zegras explained various headwinds and tailwinds Reddit will face in this clip from The Call @ Hedgeye today.
“Engagement in social media is going down,” says Zegras. “When Reddit goes public in March, it will be competing for attention in a slowing space.”
That said, Hedgeye’s Communications team led by Andrew Freedman expects the advertising cycle to work in social media’s favor in the months ahead.
“We expect pricing of ads to increase, aided by 2024 Olympics and politics,” Zegras adds. “That should create rising tides that benefit Reddit, Snapchat, Pinterest, Twitter, any social media. Bringing all that together, Reddit’s IPO isn’t coming at a great time, but it’s not a terrible time for it, either.”
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