tl;dr
Robinhood Markets (NASDAQ:HOOD) stock dropped 3.3% in Thursday premarket trading after Citi downgraded the stock and crypto trading app to Sell, fearing the market may be placing too much weight on the app's crypto business. The stock's 44% year-to-date climb appears to be largely due to rising bitc...
Robinhood Markets (NASDAQ:HOOD) stock dropped 3.3% in Thursday premarket trading after Citi downgraded the stock and crypto trading app to Sell, fearing the market may be placing too much weight on the app's crypto business. The stock's 44% year-to-date climb appears to be largely due to rising bitcoin (BTC-USD) prices (up ~64%) even though crypto only accounts for an estimated 13% of Q1 2024 revenue, analyst Christopher Allen said. "Given the increase in stock price, we believe valuation levels have disconnected from the fundamental outlook," he wrote in a note to clients. Robinhood's (HOOD) fundamentals, such as trading activity, assets under custody, and deposit growth, have improved in recent periods, he added, allowing Citi to increase its price target on the stock to $16 from $13. "But we see risks to the stock here on any material pullback in BTC prices (ETF flows have slowed lately, halving event ahead creates some uncertainty), slower retail activity, or market pullback given current valuations," Allen said. Citi's Sell rating on the stock contrasts with the SA Quant rating and the average Wall Street rating, both at Hold, and clashes with the average SA Analyst rating of Buy.
More about Robinhood Markets Inc
Stock Market Analysis: Robinhood Markets Inc Stock Market Analysis: Robinhood Markets Inc
Sector: FINANCE
Industry: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES
Market Cap: $16.04 billion
Dividend Yield: -0.61%
P/E Ratio: 2.093
Earnings Per Share (EPS): -0.29
Volume: 1,865,000,000
Stock Price: $18.23
52-Week High: $0.239
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