Reddit's shares opened 38 per cent above the offer price when they started trading on Thursday, valuing the social media platform at US$8.87 billion in a closely watched debut that could set the tone for other companies looking to go public.at the top end of the US$31 to US$34 range
The eyeball-grabbing debut will be a major test of the IPO market, where investors are seeing some green shoots, thanks to increasing bets of a soft landing. But trading in the stock over the next few weeks will be under scrutiny and could determine whether the IPO market can sustain a recent gradual recovery driven by increasing bets of a soft landing for the economy.
But the move is fraught with risks, analysts say. Typically shut out of bidding in an IPO, retail traders eager to gain exposure to a newly listed company buy shares only when they start trading, which could lead to a first-day pop. Its 100,000 online forums, dubbed"subreddits", allow conversations on topics ranging from"the sublime to the ridiculous, the trivial to the existential, the comic to the serious," according to co-founder and CEO Steve Huffman.
"We don't get many large tech IPOs. Those tend to be very popular because it's hard to buy that kind of growth," White said.