<div id="readability-page-1"><img width="1846" height="852" src="https://imageproxy.pbkrs.com/https://invezz-wp-media.lon1.digitaloceanspaces.com/2026/05/ChatGPT-Image-May-20-2026-11_21_30-PM.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://invezz-wp-media.lon1.digitaloceanspaces.com/2026/05/ChatGPT-Image-May-20-2026-11_21_30-PM.png"/>Reddit Inc (RDDT) is facing intense selling pressure on Wednesday as investor actively recalibrate their exposure to high-multiple technology assets.Following today’s pullback, RDDT sits decisively below its major moving averages (MAs) – with an RSI in the early 40s indicating further downside room before the stock hits “oversold” territory.Versus its year-to-date, Reddit stock is now down more than 40%.<h2>Pre-Nvidia jitters are hitting Reddit stock</h2>The primary catalyst driving the sell-off in RDDT shares on Wednesday is institutional de-risking ahead of Nvidia’s highly anticipated quarterly earnings.Because Reddit has increasingly branded its corporate identity as a high-margin “AI data-licensing play” – leveraging highly publicized, lucrative training content partnerships with tech giants like Google and OpenAI – its stock often moves in tandem with the speculative AI ecosystem.With institutional trading desks proactively reducing risk across AI-adjacent software names to shield portfolios from potential macro volatility, high-growth tech names are bearing the brunt of the pre-earnings anxiety.In short, traders are taking cash profits off the table ahead of Nvidia earnings, which they believe will offer more colour on the broader AI infrastructure capex trend.<h2>RDDT shares sink on valuation concerns</h2>Despite a sharp sell-off in Reddit shares this year, they continue to command a rather premium P/E multiple of nearly 33x, leaving hardly any room for operational error.The social news aggregation platform is currently more expensive to own than peers – including Pinterest Inc.These valuation concerns are evident in options pricing as well. The put-to-call ratio on contracts expiring late June sits at 2.26 currently, indicating a very strong bearish skew.The lower price on those contracts is set at roughly $127, signaling Reddit could crash up to 12% over the next four weeks.And it’s not like RDDT pays a healthy dividend to incentivize ownership despite bearish valuation and derivatives market data.<h2>Macro headwinds and yield curve pressure</h2>Adding to pressure on RDDT stock today is a fairly restrictive macroeconomic environment that’s actually weighing heavily on other long-duration growth assets as well.The global bond market has emerged as a headwind for growth stocks over the last 24 hours, pushing the baseline US 10-year Treasury yield up toward 4.66% as inflation anxieties continue to ripple through the energy markets.Higher risk-free yields inherently compress equity risk premiums, making high-flying tech names less appealing to institutional money managers.This micro-level algorithmic selling is obscuring Reddit’s otherwise exciting fundamental growth engine, including an impressive 44% increase in Q1 average revenue per user (ARPU) and a 75% increase in international revenue.That said, Wall Street remains bullish as ever on RDDT, with a consensus “moderate buy” rating and a mean price target of about $222, which signals potential upside of nearly 50% from current levels.The post Reddit stock: 3 reasons why it's slipping today appeared first on Invezz</div>

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Reddit Inc (RDDT) is experiencing significant selling pressure, down over 40% year-to-date, primarily due to institutional de-risking ahead of Nvidia's earnings. The stock is below major moving averages with a bearish RSI, and valuation concerns persist as it trades at a premium P/E multiple of nearly 33x. Macro headwinds, including rising Treasury yields, are further impacting growth stocks. Despite these challenges, Wall Street maintains a 'moderate buy' rating with a price target suggesting a potential upside of nearly 50%.

- Reddit Inc (RDDT) is experiencing significant selling pressure as investors reassess their positions in high-multiple tech assets, contributing to a year-to-date decline of over 40%.  
- The sell-off is driven by institutional de-risking ahead of Nvidia's earnings, raising valuation concerns due to RDDT's high price-to-earnings multiple and a bearish options market.  
- Despite these challenges, Wall Street remains optimistic with a "moderate buy" rating and a target price suggesting nearly 50% upside potential.