RDDT heads into its July 30 earnings report with short sellers trimming positions, insiders cashing out near recent highs, and options traders nudging toward defensiveness — a setup where positioning and price are telling slightly different stories.
The most striking signal this week is insider activity. CEO Steve Huffman and COO Jennifer Wong both sold shares on July 15, generating a combined $4.1 million in proceeds across multiple transactions. The stock was trading above $195 at the time — well above Monday's close of $181.64, suggesting these sales came near a local peak. Ninety-day net insider activity is nominally positive in share terms, but the recent cluster of sells from the two most senior operators, within two weeks of a scheduled earnings release, is worth noting in context.
Short interest has drifted lower over the past week but remains meaningfully elevated at 11.6% of the free float — down from above 12.5% just two weeks ago as shorts covered heading into the print. The borrow market tells a comfortable story for would-be sellers: availability is running at roughly 617% of current short interest, meaning supply of lendable shares is abundant relative to demand. Cost to borrow has ticked up about 9% on the week to 0.51%, but remains low in absolute terms. This is not a crowded, stressed short — it is a well-supplied one. The ORTEX short score of 53.7 has also been drifting lower all month, easing from 57 on July 8, which reinforces the picture of shorts unwinding rather than building.
Options positioning has turned modestly more defensive than usual. The put/call ratio moved to 0.81, about 1.7 standard deviations above its 20-day average of 0.80, and is running at the high end of its recent range — though still well below the 52-week peak of 0.94. This is cautious rather than alarmed: options traders are buying incremental protection into earnings, but not pricing in a sharp downside scenario.
The Street is broadly constructive but split on valuation. Wedbush assumed coverage on July 16 with an Outperform and a $250 target. Bulls at Needham and Evercore hold targets at $300, anchored to Reddit's AI data-licensing partnerships with Google and OpenAI. The more cautious end of the consensus — Wells Fargo, holding at Equal-Weight with a $187 target raised from $176 — is essentially flagging that the stock is fairly priced for what it is today. The mean analyst target of $227 implies roughly 25% upside from current levels. EV/EBITDA at 18.9x has compressed about 0.6 turns over the past month, and the PE of 22x is running slightly below its recent range after the 10% pullback. The analyst recommendation differential factor scores in the 95th percentile — meaning the consensus skews more bullish on RDDT relative to its universe than almost any other name — which itself is a double-edged data point heading into a print where execution needs to match expectation.
The last two earnings prints have been materially positive: RDDT gained nearly 13% the day after its April 30 results, holding most of that through the following week. The June 8 report produced a more modest 2.7% next-day move. That pattern — big move, smaller follow-through — is worth keeping in mind as the July 30 release approaches and the stock gives back its post-April gains.
What to watch: whether the shorts that have been covering over the past two weeks re-engage ahead of the print, and whether insider selling accelerates as the lock-up on any remaining restricted stock continues to be exercised near current price levels.
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