Stock and virtual currency trading platform company Robinhood Markets Co., Ltd. (NASDAQ:HOOD) announced its first quarter financial results after the market close on Wednesday.
Analysts are reacting to the sales and earnings per share beats, and what's next for the company.
Robinhood Analyst: Piper Sandler analyst Patrick Morley gave the stock a “neutral” rating and raised his price target to $18 from $17.
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KeyBanc analyst Alex Markgraf rates the stock as Overweight, with a price target of $23.
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Goldman Sachs analyst Will Nance has a “neutral” rating on the stock, with a price target of $20.
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Needham analyst John Todaro has a hold rating on the stock and has not set a price target.
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JPMorgan analyst Kenneth Worthington gave the stock an “underweight” rating and raised his price target from $12 to $16.
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Mizuho analyst Dan Dolev rates the stock a “buy” and raised his price target from $21 to $23.
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JMP Securities analyst Devin Ryan gave the company a market outperform rating and raised his price target from $28 to $30.
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Piper Sandler: Morley said transaction revenue exceeded expectations and exceeded expectations for the first quarter.
Analysts are highlighting the strong early results Robinhood shared in April.
“In April, HOOD announced that net deposits reached an all-time high of $5 billion per month,” Morley said.
Morley said the rise in Robinhood stock is likely due to a strong first quarter and strong trends in April.
Key bank: Markgraf said the first quarter was “a lot of good” for the asset trading firm.
“We are increasing our FY24 revenue guidance primarily due to improved trading revenue, much of which will be reduced to adjusted EBITDA,” Markgraf said.
The analyst said Robinhood saw significant net deposit growth in the quarter.
“While we do not expect this path to be linear, we believe Robinhood is poised to continue to maintain FinApp leadership and grow ARPU.”
goldman sachs:Nance said first-quarter retail trading exceeded the company's analyst expectations.
“We expect the stock to respond favorably to the company's outstanding performance, which far exceeded expectations,” Nance said.
Analysts highlight Robinhood's strong first-quarter crypto trading-related revenue.
“As we look to the future, we see there are many reasons to be positive.”
While there are positive signs ahead, including a strong quarter and a strong start to the second quarter with a record set in April, analysts cautioned about the risks and rewards.
“With interest rates likely near their peak and retail volumes near cyclical highs, we continue to view risk-reward as balanced.”
needham: Good results in trading activities and expense management were reflected in the first quarter results, Todaro said.
The analyst was “pleasantly surprised” by the crypto trading volume in the first quarter.
“April trading was strong across stocks, options, and cryptocurrencies, pointing to a positive trend for the second quarter, but crypto trading volumes were “We believe that there was a decline in Q2, and we believe this may persist for a long time,” Todaro said.
The analyst said April's record options activity could be a highlight and could contribute to higher total trading revenue in the second quarter.
“While we expect second-quarter crypto trading volume to be lower than the first quarter, we remain bullish on crypto activity for the full year 2024. It has increased.”
JP Morgan: Worthington said the company delivered “strong performance in an ideal environment” in the first quarter.
“The first quarter of 2024 was an incredibly favorable earnings environment for Robinhood, with strong stock markets, rising retail revenues, and rising crypto prices,” Worthington said.
The analyst said average revenue per user was $103, just below the all-time high of $116 that occurred during the “meme stock era” in early 2021.
“Robinhood benefited from cyclical market strength, with Robinhood gaining approximately $2.8 billion in net deposits from competitors, more than 260,000 Gold subscribers, and more than 500,000 deposits. We have also seen examples of real growth, such as winning accounts.”
Mizuho: The momentum of the first quarter carried over into the second quarter, with strong volumes in April, Dolev said.
The analyst said the first quarter was “as strong as expected.”
“Q1 was one of the strongest quarters across fintech in recent years,” Dolev said.
The analyst is encouraged by the first half of the second quarter, which saw several records set in April.
“We are raising our forecasts for FY24 and FY25 to reflect continued strong execution at HOOD.”
JMP Securities: Ryan said growth for fintech companies “remarkably remains accelerating.”
The analyst said record revenue and spending discipline were highlights of the performance.
“We expect deposits and new customers to accelerate further, with the strengthening of our gold products also increasingly contributing,” Ryan said.
The analyst said Robinhood could continue to deliver strong growth and profitability and outperform expectations.
“We further assert that the company is well positioned to continue to significantly exceed market expectations.”
Food price action: Robinhood shares rose 1% to $17.99 Thursday, compared with a 52-week trading range of $7.91 to $20.55. Robinhood stock is up 102% in the last year.
Read next: JPMorgan analyst optimistic about future approval of Spot Ether ETF despite regulatory hurdles
Image: Shutterstock
Latest review of HOOD
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date |
hard |
action |
from |
to |
|---|---|---|---|---|
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February 2022 |
deutsche bank |
maintain |
possession |
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January 2022 |
barclays |
maintain |
equal weight |
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January 2022 |
Rosenblatt |
maintain |
buy |
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This article: Robinhood Analysts 'Pleasantly Surprised' on Crypto Trading Volumes to Start of Second Quarter: 'We See Several Reasons to Be Positive' originally appeared on Benzinga.com.
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