Let’s discuss some bad news from Google and OpenAI this week that the bulls are ignoring but I refuse to.
Background: Reddit is down 33% YTD and bulls are betting the stock turns around once the company inks contract renewals with Google, OpenAI and other AI companies for licensing Reddit content as AI training data. Barron’s spelled out that hope in a July 31 feature – “Reddit Is Due for Big AI Bump. The Earnings Selloff Is a Buying Opportunity.” At 21.5x 2027 GAAP EPS, some say the stock is a bargain.
Current Situation: While everyone was enjoying their end-of-summer vacations, a third party data provider published numbers on Aug 18 that change the narrative. You need to see them. In between earnings reports, I am running more tactical updates like this one for paid subscribers.
If you own Reddit shares or are thinking about buying the Q2 dip, let’s discuss.
