Disclaimer: 1500 RDDT shares.
Okay, this is going to be regarded but please bear with me. This is a follow up to a post I made earlier this week, where I evaluated RDDT's revenue sources and analyst ratings. Today's question is simple, can RDDT hit a $1 trillion valuation in by 2030?
I'm going to do math here so skip to the end if you're interested in the simple answer.
First, we need to figure out our 2026 net income. As of 2025 RDDT had totals of $2.2 billion revenue (with a 40% increase forecasted for 2026) and $1.76 billion expenses (with a 5.6% decrease '24-'25, there aren't any forecasts for expenses for '26 so I'm going to keep this flat at 2025 numbers). Putting this together...
Net income = ($2.2 revenue x 40%) - $1.76 expenses
Or...
Net income = $1.32 B for 2026
So what, can we do it? Can RDDT reach $1 T by 2030? Depends. We can only look back at the last few years., but in doing so we can see that RDDT's 3 year Compound Annual Growth Rate averages an astonishing 48.88% and has a net income growth rate of 69.65% for 2025 from the previous year!
However, we'll need to make some assumptions since RDDT has undergone substantial changes to it's revenue models since going public. The first assumption we're going to make is the analyst predicted revenue growth rate of 40% for 2026 stays the same in 2027. The second assumption is for the expenses to stay flat for 2027 (again, despite their decrease in 2025 from 2024).
Putting this together, we get...
2027 net income = (2026 revenue x growth) - expenses
Or...
2027 = $4.312 B- $1.76 B
Or...
= $2.552 B
This is almost double what 2026's will be! Let's do something a little different for 2028 onwards. We're going to make a different assumption. We're going to increase expenses by 20%. This is for anything that might come up in their growth cycle. It does cost money to grow, afterall.
Dropping the same calculation, we get $3.925 B, a 53% increase for 2028!
My tiny monkey brain has difficulty thinking out over 3 years, so we'll do the same thing as 2028 onwards. For 2029, with 40% rev growth and 20% expense growth, we get $6.34 B.
Same formula for 2030... 40% rev growth and 20% expense growth. We get $9.30 billion.
Final calculation! The assumption here is that I'm going with a P/E multiple of 60, as that's what RDDT's currently trading at in this bear market. One final calculation...
Market Cap = Net Income x P/E Ratio
Or...
Market cap = $9.30 billion x 60
Or...
= $0.558 trillion in 2030...
Oof, did I just miss my target?! Well, before February Software had high multiples and for 2026 RDDT will buy back $1 billion dollars worth of shares. I didn't account for either of these. The share buyback increases EPS. My last assumption is that EPS and share counts stay the same. This won't be true, not even close. Current estimates are for a 95% EPS year over year increase! That's crazy high! Giving a Price to EPS ratio a ridiculous boost!
Last assumption: RDDT traded with as high of a PE multiple as 120. So the last assumption we're going to make is that we'll be in a bull market and RDDT can sustain share buybacks throughout the years. We'll give RDDT back their old PE multiple of 120.
Market cap = $9.30 billion x 120
Or ...
= $1.116 trillion in 2030!