We recently published a list of Jim Cramer’s Latest Calls Before 2025 Begins: Top 10 Stocks. In this article, we are going to take a look at where Reddit Inc (NYSE:RDDT) stands against other stocks in Jim Cramer’s latest calls before 2025 begins.
Jim Cramer in a latest program talked about the market reaction to the Federal Reserve’s latest rate cut and its guidance that suggested fewer rate cuts moving ahead.
“I guess you could say the baby got thrown out with the bathwater. It was truly hideous, a little unexpected, and yes, wicked. Even though the market’s barely oversold, we may not get that quick snapback we normally expect in a deeply oversold market,” Cramer said.
Jim Cramer said Jerome Powell’s comments and tone were “stern” and his conference call “confounded” investors. Cramer said inflation has not come down enough and that has made the Fed’s job difficult.
Cramer then talked about different sectors and companies that need rate cuts amid a slowdown.
“I really wish the Fed hadn’t been so defensive about the need to cut rates going forward. A slower approach would have been much better. If they had explicitly taken a wait-and-see approach before this meeting, we’d be in a better position. This time, they telegraphed the wrong thing, hence today’s meltdown. However, if the weaker part of the economy deteriorates further or inflation comes down, the Fed still has room to cut. Here’s the bottom line: a previously data-dependent Fed chose not to be data-dependent today with its pronouncements, and that’s what drove the market down. This happened despite the quarter-point rate cut—something that’s typically good news for stocks—but it turned out to be the very opposite.”
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In
For this article, we watched some latest programs of Jim Cramer and picked 11 stocks he is talking about. With each company, we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Reddit Inc (NYSE:RDDT)
Number of Hedge Fund Investors: 52
Jim Cramer has been bullish on Reddit Inc (NYSE:RDDT) but the stock’s bull run has him recommending investors to wait for a pullback. In a latest program, Cramer said:
“I like Reddit, but you know what? Reddit now has a parabolic chart, and I don’t know what to do about it. It’s just going bonkers, and I wish it had a pullback before I could recommend it. It’s an extraordinary chart, but it has just moved up too much.”
With over 80 million daily active users, Reddit Inc (NYSE:RDDT) remains one of the fastest-growing social media platforms in the world. While Facebook and Twitter show signs of maturing growth, Reddit Inc (NYSE:RDDT) still has huge upside potential as more and more people flock to Reddit discussion boards for authentic opinions and discussion. User input from millions of people on various topics freely accessible to anyone is Reddit Inc (NYSE:RDDT)’s moat. As of 2023, users posted 16 billion comments on the platform, according to the company. That’s why companies are flocking to pay money to Reddit to use its data to train their AI models. Reddit Inc (NYSE:RDDT) has a licensing agreement with Alphabet Inc.’s Google worth $60 million to help train large language models. Reddit Inc (NYSE:RDDT) has signed licensing agreements totaling $203 million, with terms lasting two to three years. The company generated approximately $20 million from AI content deals last quarter and expects to exceed $60 million by year-end. Reddit Inc (NYSE:RDDT) has signed licensing agreements totaling $203 million, with terms lasting two to three years.
Overall, RDDT ranks 6th on our list of Jim Cramer’s latest calls before 2025 begins. While we acknowledge the potential of RDDT, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RDDT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.