Reddit 被低估，因其基本面强劲（营收增长超 60%，自由现金流增加），尽管市场担忧 AI 导致的流量流失；成功取决于数据许可和核心广告改进的执行。

Now, Reddit, why is it undervalued to me? Reddit right now is a company worth around $29 billion, has a trailing PE of 35.6 times, but a forward one of 21.3 times.

Year-to-date, the stock is down 36.7%, and over the past 12 months, the stock is down 30.4%. Now, Reddit, while you might only look at the stock and say, "Oh, the company is definitely not doing well." Well, actually, the it's the contrary. The company has grown revenue by over 60% for the last X quarters, so the growth is definitely there. The market is still expecting this company to grow quite rapidly over the foreseeable future.

Not only that, we are also seeing that this company generates more and more free cash flow. It is becoming more profitable. Now, why is it cheap today? Well, it's cheap today because the market fears that well, uh Google AI overviews or ChatGPT, these types of AI chatbots are stealing traffic or are taking traffic away from Reddit's website, and Reddit themselves have said that they've seen search traffic, Google traffic come down a little bit.

Now, despite that, they still grew revenue by 60% last quarter. Now, to tackle the loss of Google traffic or the loss of traffic in general to these types of AI chatbots is to make sure that they get paid through data licensing deals. Now, we've had a data licensing deal, we've seen those. But if Reddit's data is so valuable you would think they would renew it and get paid even more.

To Reddit, it's not going to be tens of billions of dollars for their data, but it could be hundreds of millions of dollars and that could of course boost the company because those are high-margin dollars.

Then if we purely look at the core business itself, let's say let's say they they do get hit by traffic a little bit. The average revenue per user for a Reddit sits at around $6 and some change.

So, the average revenue per user expansion can already be part of of the core thesis here because if yes, if through AI we've seen with Meta for example, recommendation systems becoming better and better, Reddit could do the same. They are refreshing the way the feed works as well. So, clearly average revenue per user is already a big a bullish part of of the thesis.

Now, of course, execution is key. They are also going to try to do things with video. We know that video has been doing excellent on YouTube, Instagram, TikTok. So, if they can if they can figure this out, if they can make sure that advertisers like the return on ad spend, I think this is truly an undervalued business as of right now, but there is definitely execution risk, which is probably why the stock is down around 30% this year.

One of the things that's kind of interesting to think about is, you know, what success looks like for a company like this. You know, maybe they won't have that 60% plus revenue growth, you know, 5 10 years from now, but, you know, 30 40% for a more mature company at that point that would be, you know, 30 years old almost at that time. I think that that would also be a compelling growth story.

And you think about Reddit and how it's historically worked. It has been that go-to third space for so many people around the world to congregate on the topics or ideas or, you know, real-life events that are happening to discuss that and to socialize in that way online. And that has essentially been the purpose of Reddit from the very beginning.

And from a the AI side and looking at how that the company and that business model translates into the sort of new growth era, that also creates an incredible wealth of data for these companies that need to build and train their models. And having historically been that third space and continuing to be, I do think Reddit can maintain its relevance and its utility to these companies, you know, moving forward.

I mean, they've also really been able to use AI to boost their advertising business. You know, they have been able to drop very targeted ads specifically inside, you know, comment sections to help kind of match products with real-time user intent. They've been using AI to translate a lot of the the different Reddit threads, which of course has unlocked more international user growth. They're scaling much faster outside of the US than a lot of the other social apps.

And so, I do think there's a lot of ways for them to win. Obviously, you know, selling that data to the likes of Alphabet, no pun intended, provides a lot of upfront cash, but I do think there are other ways as well for them to grow.

Another thing to consider, you know, Reddit's traffic relies a lot on how Alphabet indexes its links, or Google, I should say, owned by Alphabet. And so, if we see a change in, you know, algorithms or, you know, the constant summarizing of posts using AI snippets, maybe that could lead to a drop in traffic,

but at least what now in these early reports that are coming out after we're seeing all of these AI changes and updates that, you know, Alphabet has released and others, this seems to be a business, Reddit, that is still actively monetizing their data and their user base, and they're doing it in a profitable way. And so, I do think that that makes it a much more interesting company from my perspective to watch, or at least, you know, put on your watch list, than maybe even a few years ago.

But at the end of the day, I want to see continuous execution from the business. If their data is truly extremely valuable, I do think that they deserve to get paid, and we'll see. We'll see what happens over the upcoming months.