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Reddit Inc. (RDDT) vs Spotify Technology (SPOT)

Reddit Inc. and Spotify Technology are both Internet Content & Information companies. Spotify Technology is the larger, with a market value of $126.5B against $18.1B — 7.0× the size. Reddit Inc. trades at the lower P/E: 18.2× against 36.8×. Reddit Inc. grew revenue faster over the last twelve months: 62.2% against 16.9%. Reddit Inc. has the higher net margin (32.1% vs 15.5%) and the higher return on invested capital (103.5% vs 0.00%). Across the 19 metrics below, Reddit Inc. leads on 17 and Spotify Technology on 2.

Valuation

Metric RDDT SPOT Internet Content & Information median
P/E 18.25 36.84 12.38
P/S 5.88 5.80 0.93
P/B 5.07 12.60 1.24
Price to free cash flow 15.17 35.35 10.76
EV/EBITDA 16.37 35.30 10.74
EV/Sales 4.90 5.34 1.20
Earnings yield 5.48% 2.71% (1.71%)
Free cash flow yield 6.59% 2.83% 4.26%

Profitability

Metric RDDT SPOT Internet Content & Information median
Gross margin 91.55% 33.11% 63.25%
Operating margin 29.40% 14.56% (1.87%)
Net margin 32.11% 15.49% (1.37%)
Free cash flow margin 38.79% 16.40% 3.47%
Return on equity 32.03% 35.36% (1.19%)
Return on assets 29.00% 20.13% 0.00%
Return on invested capital 103.51% 0.00% 0.00%

Growth

Metric RDDT SPOT Internet Content & Information median
Revenue growth (TTM) 62.18% 16.91% 6.92%
EPS growth (last fiscal year) 178.68% 99.83% 34.37%
Revenue growth, 5-year CAGR — 16.65% 10.46%
Net income growth, 5-year CAGR — 0.00% 0.00%

Health

Metric RDDT SPOT Internet Content & Information median
Debt to equity 0.00 0.00 0.01
Current ratio 10.80 2.13 1.84
Net debt to EBITDA (5.41) (4.12) (0.53)

Dividend

Metric RDDT SPOT Internet Content & Information median
Dividend yield — — 1.19%
Payout ratio — — 0.27

Size

Metric RDDT SPOT Internet Content & Information median
Market cap 18.11b 126.50b 693.23m

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