Reddit's upcoming initial public offering (IPO) is currently four to five times oversubscribed amid strong demand for shares of the social media company, according to a report from the Reuters news agency.
The oversubscription makes it more likely that Reddit will be able to price its stock between $31 U.S. and $34 U.S. per share and achieve its target valuation of $6.50 billion U.S.
Reddit is planning to make its stock market debut on March 21 and its shares will trade under the ticker symbol “RDDT” on the New York Stock Exchange (NYSE).
However, the oversubscription comes after Reddit lowered its valuation from $10 billion U.S. in an earlier funding round. The company is now seeking to raise $748 million U.S. from the IPO.
Reddit is one of the largest technology IPOs of the past two years and is the first major social media company to go public since Pinterest (PINS) in 2019.
Although in business since 2005, Reddit remains unprofitable. The company relies on online advertising for revenue and volunteers for content on its various message boards.
Reddit's online message boards, or forums, facilitate conversations on all manner of topics, from politics and investing to recipe exchanges and celebrity gossip.
Reddit claims to have 73 million daily active users on its platform, according to regulatory filings.
The company's “Wall Street Bets" forum, where individual retail investors discuss various stocks, is its best known and most popular online forum.
In a nod to its retail investor base, Reddit has reserved 8% of the total shares on offer in its IPO for users and moderators on its social media platform.
