Robinhood's User Growth Fuels Over 200% Stock Surge

Written by Emily J. Thompson, Senior Investment Analyst

HOOD+0.17%

Source: Fool

Updated: 1h ago

0mins

Source: Fool

Significant User Growth: Robinhood's total user base reached 26.8 million in Q3, marking a 10% year-over-year increase, which not only reflects the platform's appeal but also lays a foundation for future revenue growth.
Doubling Revenue: The company reported $1.3 billion in revenue for Q3, doubling year-over-year, with non-GAAP earnings soaring 259% to $0.61 per share, showcasing strong financial performance that is heavily reliant on overall market conditions.
Increased Market Risks: Despite Robinhood's impressive growth, its revenue is primarily generated from high-risk trading areas such as cryptocurrencies and options, making the company vulnerable during market fluctuations.
Economic Slowdown Warning: With the U.S. unemployment rate rising to 4.6% in November and October layoffs hitting a 22-year high, signs of economic slowdown could impact Robinhood's stock price, prompting investors to be cautious about potential market downturns.

HOOD

$120.44+Infinity%1D

Analyst Views on HOOD

Wall Street analysts forecast HOOD stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for HOOD is 151.63 USD with a low forecast of 68.00 USD and a high forecast of 181.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.

21 Analyst Rating

14 Buy

6 Hold

1 Sell

Moderate Buy

Current: 120.240

Low

68.00

Averages

151.63

High

181.00

Current: 120.240

Low

68.00

Averages

151.63

High

181.00

Morgan Stanley

Equal Weight

maintain

$146 -> $147

2025-12-22

New

Reason

Morgan Stanley

Price Target

$146 -> $147

2025-12-22

New

maintain

Equal Weight

Reason

Morgan Stanley raised the firm's price target on Robinhood to $147 from $146 and keeps an Equal Weight rating on the shares. Healthy transactional activity across brokers and exchanges in Q4 drives modest positive revision risk, notes the analyst in a preview. The analyst is raising Q4 EPS estimates by 5% on average, leaving the firm in-line with consensus, the analyst noted.

Deutsche Bank

Buy

maintain

$160

2025-12-17

Reason

Deutsche Bank

Price Target

$160

2025-12-17

maintain

Buy

Reason

Deutsche Bank keeps a Buy rating on Robinhood with a $160 price target following the company's yes/no keynote event. The company showcased its latest prediction market features and management said they believe the prediction markets are in the early stages of a "supercycle," the analyst tells investors in a research note. With increasing adoption and volume growth, these contracts could eventually reach trillions in volumes traded each year, according to Robinhood, the analyst adds. Deutsche estimates prediction markets in the U.S. could potentially reach at least 1 trillion contracts in 2027 and well over 5 trillion in 2029. Robinhood's developments in prediction markets include making the contracts available on both the mobile app and Legend desktop, with real-time data and limit orders, the firm points out.

Truist

NULL -> Buy

initiated

$155

2025-12-16

Reason

Truist

Price Target

$155

2025-12-16

initiated

NULL -> Buy

Reason

Truist initiated coverage of Robinhood with a Buy rating and $155 price target.

Truist

David Smith

Buy

initiated

$155

2025-12-16

Reason

Truist

David Smith

Price Target

$155

2025-12-16

initiated

Buy

Reason

Truist analyst David Smith initiated coverage of Robinhood with a Buy rating and $155 price target. The company is experiencing "sizable growth" in key metrics and market share gains as its addressable customer universe expands with new products, the analyst tells investors in a research note. The firm sees continued prospects for growth and "attractive" scale economics driving margin expansion for Robinhood. Better profitability creates additional capacity to invest in growth, organically or via acquisitions, adds Truist. It believes Robinhood is on track for its second straight year of 50%-plus revenue growth with 20% achievable for the next few years "even off of this much higher base."

About HOOD

Robinhood Markets, Inc. is creating a financial services platform for everyone, regardless of their wealth, income, or background. It uses technology to provide access to the financial system. Its offerings include Brokerage, Robinhood Crypto, Custody, Robinhood Wallet, Robinhood Gold, and Robinhood Gold Card. Its Brokerage services include investing, options trading, fractional trading, recurring investment, access to investing on margin, fully paid securities lending, cash sweep, instant withdrawals, Robinhood retirement, 24-hour market, joint investing accounts, and event contracts. It also offers a variety of ways for its customers to grow their financial knowledge, including Robinhood Learn, In-App Education, Newsfeeds, Sherwood Snacks, and Crypto Learn and Earn. Its self-clearing system, order routing system, data platform, and other back-end infrastructure deliver the capabilities that allow its customers to focus on investing, saving and spending.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.