Robinhood Markets, Inc. HOOD inventory skyrocketed to all-time highs in October because it flexed its rising credentials as a diversified digital brokerage powerhouse.
HOOD reworked from an upstart stock-trading app that turned well-known within the early months of Covid into an S&P 500 big and a direct competitor to Constancy and different on-line brokerages.
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Regardless of its roughly 50% drop from its highs, the boundary-pushing monetary companies agency has soared 650% prior to now two years to greater than triple Nvidia and blow away many different synthetic intelligence shares.
Robinhood grew overheated and was due for a wholesome recalibration. Its earnings and income progress outlook stay robust even because it will get caught in fears surrounding bitcoin, AI disruption, and past.
It’s way over an app for meme-stock merchants. Immediately, HOOD boasts that its 11 separate enterprise strains every generate ~$100 million or extra in annualized revenues.
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HOOD is approaching some very enticing technical ranges for merchants and long-term buyers to begin shopping for the inventory heading into its This autumn earnings launch on Tuesday, February 10.
The expansion inventory is approaching its submit IPO breakout peak from 2021. Robinhood’s common Zacks worth goal provides 86% upside to its present worth, and it’s buying and selling at its most oversold RSI ranges in historical past.
Why Traders Ought to Purchase Robinhood Inventory
Robinhood would possibly nonetheless be considered as a meme-stock-mania-app to a big pocket of buyers. However that firm and its customers have come a good distance because it first disrupted the trade with commission-free inventory buying and selling, which is now normal throughout most digital brokers, together with Constancy.
HOOD is rising right into a respectable rival to Constancy, catering to a big swath of buyers and complex merchants with a rising portfolio. The corporate is now an S&P 500 member after it joined the illustrious group in September.
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HOOD stated final quarter that it has “11 enterprise strains every producing ~$100 million or extra in annualized revenues.” The corporate provides retirement accounts, crypto buying and selling, futures, choices, a browser-based desktop buying and selling platform constructed for lively merchants, wealth administration, prediction markets (to tackle Polymarket), and extra.
The agency’s paid Gold Subscribers elevated by 77% YoY in Q3 to three.9 million, whereas whole funding accounts elevated by 2.8 million, or 11% to 27.9 million.
HOOD’s common income per person soared 82% to $191 within the third quarter as a part of a 100% YoY bounce in whole quarterly gross sales. In the meantime, its earnings per share soared 259% to $0.61, serving to it crush our bottom-line estimate for the fourth quarter in a row (26% common beat).
Robinhood is projected to develop its adjusted EPS by 85% in 2025 and one other 23% in FY26 to succeed in $2.48 a share, vs. a -$0.60 loss in 2023 and +$1.09 a share in 2024. HOOD’s 2026 earnings outlook has jumped 9% over the previous few months and 63% since final summer time.
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The close by chart reveals that HOOD’s earnings outlook has surged over the past two years, together with a big cost within the again half of 2025 and lately. On high of that, its Most Correct estimates got here in above its already improved consensus.
Robinhood’s huge EPS enlargement is supported by 53% projected income progress in 2025 and 22% larger gross sales in 2026 to hit $5.50 billion, up from $2.95 billion in 2024.
Purchase HOOD Inventory Now On the Dip and Maintain?
The inventory overtook its post-2021 IPO highs in the summertime of 2025. Regardless of its 650% run prior to now two years, which helped it blow away Nvidia NVDA and lots of different AI shares, Robinhood’s selloff has it testing these earlier peaks. The bulls tried to carry HOOD’s 2021 highs on Wednesday.
Robinhood is down almost 50% from its early October peaks. HOOD is buying and selling at roughly $75 a share, which implies its common Zacks worth goal represents 86% upside from its present ranges. The monetary tech inventory would additionally should roughly double (+100%) to get again to its all-time highs of $150 a share.
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HOOD was due for a selloff to assist it cool off. It’s now buying and selling at a 60% low cost to its highs at 35.7X ahead 12-month earnings.
Robinhood additionally trades at a 75% low cost to its highs when it comes to its worth/earnings-to-growth (PEG) ratio at 1.3, roughly matching the Zacks Tech sector—HOOD is up 130% since its IPO vs. Tech’s 70% climb throughout that interval.
Some buyers would possibly wish to check the waters on Robinhood now, after which see how Wall Avenue reacts when it stories its This autumn outcomes and provides near-term steering subsequent week.
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This high choose is a little-known satellite-based communications agency. House is projected to turn out to be a trillion greenback trade, and this firm’s buyer base is rising quick. Analysts have forecasted a significant income breakout in 2025. After all, all our elite picks aren’t winners however this one may far surpass earlier Zacks’ Shares Set to Double like Hims & Hers Well being, which shot up +209%.
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This text initially revealed on Zacks Funding Analysis (zacks.com).
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
