TLDR
- Robinhood stock gained 36% in August, making it the best-performing major financial stock that month.
- Q2 revenue hit a record $1.31 billion, up 32.5% year over year, with EPS of $0.62 beating estimates of $0.44.
- Event-contract revenue surged to $156 million, topping both crypto ($100 million) and equities ($129 million) revenue.
- Morgan Stanley upgraded HOOD to Overweight with a $150 price target; Piper Sandler raised its target to $145.
- HOOD has a Strong Buy consensus with an average price target of $127.43 and a high target of $160.
Robinhood Markets (HOOD) opened at $122.11 on Monday, after gaining 36% in August. That made it the top-performing major financial stock last month, easily outpacing the Financial Select Sector SPDR Fund, which gained just 0.54%.
The stock’s 52-week range runs from $63.51 to $153.86, and it now carries a market cap of around $109.79 billion.
The August rally was backed by strong fundamentals. Q2 revenue came in at a record $1.31 billion, up 32.5% year over year. EPS of $0.62 beat analyst estimates of $0.44 by $0.18.
Transaction-based revenue rose 44% to $776 million, driven by event contracts, options, and equities activity.
Event contracts were the standout. Revenue from that segment surged to $156 million in Q2, more than ten times the prior year, and it topped both crypto ($100 million) and equities ($129 million) revenue for the first time.
Robinhood launched its CFTC-licensed prediction market exchange, Rothera, in June. More than 3.5 billion contracts had been traded through the platform by the end of Q2.
AI Trading Gains Early Traction
Robinhood launched Agentic Trading in May. The tool lets customers use AI agents to trade stocks, options, and crypto.
By the end of Q2, nearly 100,000 customers had opened Agentic Trading accounts, with more than $100 million in assets under custody.
The company now runs 13 business lines each generating more than $100 million in annualized revenue.
CEO Vlad Tenev said Trust Accounts, launched in August, have already pulled in more than $150 million from customers.
Robinhood’s new blockchain generated about $3.8 million in fees on September 1 alone, a sign that crypto remains an active growth area.
Wall Street Upgrades Roll In
Morgan Stanley upgraded HOOD from Equal Weight to Overweight on September 1, lifting its price target from $124 to $150.
Piper Sandler analyst Patrick Moley raised his target from $135 to $145, pointing to expected growth in prediction market activity once football season picks up.
Scotiabank also initiated coverage with a bullish view during the period.
Not everyone moved higher. Barclays cut its target from $122 to $105, and Goldman Sachs trimmed its target from $137 to $118, though both kept buy-equivalent ratings.
Institutional ownership stands at 93.27%. TD Waterhouse Canada increased its stake by 51.1% in Q2, bringing its holdings to 53,324 shares worth about $5.8 million.
Insiders, however, have been selling. CEO Vladimir Tenev sold 375,000 shares at $116.17 on July 6, a 50% reduction in his holding. CFO Shiv Verma also sold shares in August. Combined insider sales over the last 90 days total roughly $69.1 million.
The current analyst consensus sits at a Moderate Buy with an average price target of $122.67, near where HOOD is trading now.
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