It’s popularly known as a forum-based social media platform that hit the headlines in January 2021 for being the place where r/WallStreetBets plotted the seismic short squeezes of GameStop and AMC stocks alike. Now, Reddit plans to launch its own…
IPO in the coming weeks – how will retail investors react?
The San Francisco-based company confirmed in mid-December that the listing is set to take place after the US Securities and Exchange Commission completes its review process – depending on market conditions and other factors. Reddit also claimed that no decisions have yet been taken regarding the number of shares or pricing range for its initial public offering.
Reddit, which was valued at $10 billion by investors in a funding round in the summer of 2021, is yet to confirm its target valuation for the listing.
Although it’s not a public company yet, Reddit inadvertently played a key role in some of the biggest stock market movements across the past year.
As we can see from the performance of both GameStop and AMC over the course of 2021, we can see that the two stocks – both favorites of the Reddit group r/WallStreetBets – have rallied significantly over the past 12 months.
Both GameStop and AMC stocks are regarded as meme stocks because they operate purely on investor sentiment, as opposed to their respective fundamentals.
Whilst Reddit, a social network that’s accumulated around 430 million active monthly users, offers plenty in the way of fundamentals, the company’s role in the popular world of meme investing may generate higher volumes of interest and purchase intent among retail investors.
Based on fundamentals, Maxim Manturov, head of investment advice at Freedom Finance Europe, highlighted Reddit as one of his picks for the biggest listings of 2022.
“In 2022, companies such as…
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