After much anticipation and speculation, Reddit went public on Thursday. The IPO price was set at $34 per share, and by approximately 2:15 pm ET, it was trading at around $50 per share. This represents an increase of almost 50%.
Reddit is obviously an important website in the ecosystem of the online world. However, it was never a particularly profitable endeavor. In fact, in the 18 years since its establishment, no way Turn losses into profits.
This fact, combined with a general distaste for Reddit’s push for monetization, led the influential stock market subreddit r/wallstreetbets to place bets on Reddit. The subreddit sent GameStop and other stocks skyrocketing, much to the chagrin of hedge funds that were betting against the companies. But r/wallstreetbets is firmly shorting Reddit’s stock, with many users believing its value is set too high.
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To be fair, the $34 share price values Reddit at $6.4 billion, which is…a lot of money. Before the stock actually hits the market, though, there are signs it could start trading at around $50 a share. This is the case once a stock starts trading in earnest.
According to Reuters, Reddit is considered an important IPO in the financial world, if not a giant in the Meta field.
Julian Klymochko, CEO of investment firm Accelerate Financial Technologies, said: “If Reddit trades poorly, it will cast a shadow on the IPO market. Many companies will suspend IPO plans.”
Still, an IPO makes sense initial for some reason. This is just Reddit’s first day as a public company, and there’s a lot more to come.
This story is developing and will be updated…