Reddit shares got absolutely smoked compared to social media rivals like Meta and Snap yesterday, dropping 20%
March 11, 2025
9h
Yesterday, Reddit shares suffered their worst drop since going public just under a year ago, as the platform’s rocky start to 2025 continues. After a pretty remarkable 2024, the stock is now down more than 35% so far this year.
With market misery across the board on Monday — the S&P 500 suffered its worst day of 2025 and the Nasdaq 100 notched its worst session since 2022 — Reddit wasn’t alone in falling, but the scale of its descent did separate it from the wider pack… especially compared with peers in the socials space.
While there were drops for Meta, Snap, and Pinterest, none suffered quite like Reddit, as the latest major social platform to go public proved most vulnerable to the whims of the market’s wider downturn. Reddit shares remain, at the time of writing, up ~113% from their IPO price last March.
Still, if you’re one of the execs at chat platform Discord reportedly eyeing your own potential IPO, Reddit’s recent woes might be enough to make you cast a downvote on getting to work on the idea anytime soon.
While there were drops for Meta, Snap, and Pinterest, none suffered quite like Reddit, as the latest major social platform to go public proved most vulnerable to the whims of the market’s wider downturn. Reddit shares remain, at the time of writing, up ~113% from their IPO price last March.
Still, if you’re one of the execs at chat platform Discord reportedly eyeing your own potential IPO, Reddit’s recent woes might be enough to make you cast a downvote on getting to work on the idea anytime soon.
More Markets
2h
US stocks slump as traders ditch the stocks previously immune from the sell-off
Stocks whipsawed as President Trump floated fresh tariffs on Canada, with the S&P 500 ending down 0.8% and the Russell 2000 off 0.3% while the tech-heavy Nasdaq 100 gained 0.2%.
Under the hood, it sure doesn’t seem like tariff talk played too large of a role today — General Motors, perhaps the company most impacted by trade barriers with Canada, actually rose.
Telling the tale of the tape today is relatively easy: if a stock had been getting creamed since February 19, the most recent closing high, through March 10, then it did well today. Conversely, if a stock had been holding up well through the carnage, it ceded ground today.
Said another way, every S&P 500 constituent that’s down 30% since the S&P 500’s record close, like Palantir, rose on Tuesday. And only two stocks of the couple dozen that are up 10% since February 19 rose on Tuesday.
Interestingly, this was the first time during the S&P 500’s retreat from its all-time high where the benchmark index fell and the equal-weight S&P 500 suffered a larger loss than the iShares MSCI USA Momentum Factor ETF (which actually ended higher on the day!). Investors ditched the safer stocks that had been holding up well while beaten-up names caught a bid.
Every S&P 500 sector ETF finished lower, with industrials, communications services, and consumer staples suffering the largest losses.
Kohl’s cratered, losing nearly a quarter of its value as its solid fourth-quarter results were overshadowed by abysmal guidance and a reduction in its quarterly dividend.
Dick’s Sporting Goods told a similar, but less severe, story and sold off after also exceeding its fourth-quarter earnings expectations while offering a dim outlook for 2025.
Shares of software company Oracle fell after posting lower-than-expected earnings and sales after the close on Monday.
Verizon also tumbled after its CRO warned of a “challenging” first quarter for the telecom company.
Southwest’s was a particularly bright spot on the tape today, rising 8% after ditching its “bags fly free” policy, a move which passengers will invariably despise.
6h
Dick’s Sporting Goods scores Q4 earnings beat, but stock is down for the count after guidance strikes out
Shares of Dick’s Sporting Goods fell about 6% early Tuesday afternoon, on pace for their worst day since last July, even after the sports retailer scored a Q4 earnings beat. Revenue for the quarter came in at $3.89 billion, versus FactSet analysts’ estimates of $3.77 billion. Earnings per share also topped expectations, reaching $3.62.
But the outlook was more rocky: Dick’s is expecting full-year earnings per share to be between $13.80 and $14.40, short of Wall Street estimates of $14.82, according to FactSet. Meanwhile, net sales are expected to be between $13.6 billion and $13.9 billion, which is in line with the higher end of estimates of $13.88 billion. Shares of Dick’s Sporting Goods are still nearly 10% higher over the past year.
In the upcoming year, Dick’s plans to spend $1 billion on a net basis to build 16 of its 100,000-square-foot House of Sport locations. Dick’s also plans to capitalize on the rising popularity of women’s sports and the World Cup soccer matches in the US next year.
But the outlook was more rocky: Dick’s is expecting full-year earnings per share to be between $13.80 and $14.40, short of Wall Street estimates of $14.82, according to FactSet. Meanwhile, net sales are expected to be between $13.6 billion and $13.9 billion, which is in line with the higher end of estimates of $13.88 billion. Shares of Dick’s Sporting Goods are still nearly 10% higher over the past year.
In the upcoming year, Dick’s plans to spend $1 billion on a net basis to build 16 of its 100,000-square-foot House of Sport locations. Dick’s also plans to capitalize on the rising popularity of women’s sports and the World Cup soccer matches in the US next year.
Stocks lurch lower after Trump escalates tariffs
A fresh tariff threat from President Trump worsened the stock market’s losses Tuesday, pushing the S&P 500 closer toward a technical correction, or a drop of 10% from a recent high.
For the record, just because stocks fall into a correction doesn’t necessarily imply a bear market will follow. The 10% line in the sand is a relatively arbitrary Wall Street way of describing a market sell-off that’s a bit more than your garden variety slump, but not quite as bad as a bear market.
7h
Silver lining to the sell-off: Safe stocks are getting dumped as the momentum stock fever breaks
A glass-half-full view of another dour tape, as the S&P 500 lowers and President Trump ratchets up tariffs on Canada: the market’s hidey-holes are getting hit more than the momentum stocks whose breakdown has thus far been front-and-center in driving the overall sell-off.
The iShares MSCI USA Min Vol Factor ETF, which, as the name suggests, holds stocks that tend to be less volatile than average (i.e. they have a lower beta), is down 0.9% as of 11:20 a.m. ET. Meanwhile, the iShares MSCI USA Momentum Factor ETF, which holds companies with the strongest 6- and 12-month risk-adjusted performance, is up.
If sustained, this would mark the first time minimum volatility stocks underperformed momentum on a down day for the S&P 500 since the retreat from record highs began.
Over the history of these products, stretching back to 2013, the recent three-week performance of MTUM versus USMV has never been worse, as of yesterday’s close.
As a shorthand, perceived “safe” companies like Verizon, General Mills, and McDonald’s are falling more than the S&P 500, while the likes of Reddit, AppLovin, and Robinhood bounce.
(Sherwood Media is an independently operated subsidiary of Robinhood Markets Inc.)
The only comparable stretch of momentum underperformance versus min vol was late 2021, a period that bears some resemblance to the current environment: an abrupt increase in policy uncertainty (Omicron variant then; tariffs, US growth, and AI concerns now), a big US bond rally, and the aforementioned shellacking of momentum stocks and herding into their min-vol counterparts.
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