Key Takeaways

Shares of Reddit ( RDDT ) jumped in premarket trading Friday, a day after the social media company reported better first-quarter results than expected and issued a strong outlook.

The company expects second-quarter revenue of $410 million to $430 million, above the $394 million Visible Alpha consensus. Shares were up more than 4% to about $124 about 30 minutes before the opening bell, but they entered Friday having lost more than a quarter of their value this year.

JPMorgan analysts after the report kept a "neutral" rating on Reddit stock while lifting their price target to $145 from $110. The analysts said that Reddit "continues to execute well & capture share of advertiser budgets," and said they expect the platform to continue growing revenue and profitability.

The new price target brings JPMorgan analysts closer to the consensus of $153.21 compiled by Visible Alpha. The stock has 10 "buy" ratings, along with four "hold" and one "sell" ratings.

Citi analysts moved from below the consensus to above it following the report, lifting their price target to $158 from $150 while affirming their "buy" rating. The analysts said they "believe there are several potential catalysts for Reddit to deliver continued user and revenue growth" including wider rollout of new features like the artificial intelligence-powered Reddit Answers .

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