TLDR
- Robinhood stock jumped 12.27% to close at a record high of $136.72 on Monday
- The platform has traded over 4 billion event contracts, including 2 billion in Q3 alone
- Q2 revenue hit $989 million, beating Wall Street estimates by $69 million
- Crypto trading revenue surged 98% year-over-year to $160 million
- Analysts raised price targets with Mizuho projecting $145 per share
Robinhood Markets stock surged to a record close of $136.72 on Monday. The 12.27% gain made HOOD the top-performing stock in the S&P 500 for the session.
The rally comes after CEO Vlad Tenev revealed the platform has surpassed 4 billion event contracts traded. The company processed 2 billion of those contracts in Q3 alone.
Event contracts allow users to place bets on elections, sports outcomes, and other real-world events. This prediction markets business has become a major revenue driver for the platform.
Year-to-date, Robinhood stock has climbed over 260%. The shares have gained more than 450% from April lows near $30.
Prediction Markets Drive Growth
Piper Sandler analyst Patrick Moley increased his price target from $120 to $140. He kept his Buy rating intact.
Moley noted that event contract volumes at Kalshi are heading toward a record September. Robinhood partners with Kalshi to offer prediction markets to its users.
The analyst estimates Robinhood users make up 25% to 35% of daily Kalshi trading volumes. NFL and NCAA football markets have driven much of the recent activity.
Revenue from event contracts is on pace to annualize at over $200 million in September alone. That’s a meaningful contribution to Robinhood’s overall revenue mix.
Q2 Earnings Crush Expectations
Robinhood reported Q2 revenue of $989 million. That crushed the Street’s $920 million estimate.
Revenue grew 45% year-over-year. Earnings per share came in at $0.42, beating the $0.31 consensus by 35%.
Net income jumped 105% compared to the same quarter last year. Adjusted EBITDA reached $549 million.
The crypto division shined particularly bright. Crypto trading revenue soared 98% to $160 million year-over-year.
Robinhood added 2.3 million new funded accounts during the quarter. Growth came from both traditional brokerage and crypto products.
Analysts Turn More Bullish
Robinhood joined the S&P 500 on September 22. The inclusion brought increased institutional investor attention.
BofA Securities raised its price target to $139. Mizuho went higher, projecting $145 per share.
Wall Street maintains a Moderate Buy rating on HOOD stock. The consensus includes 12 Buy ratings and six Hold ratings.
The average analyst price target sits at $127.06. That’s actually below current trading levels, suggesting the stock has run ahead of some expectations.
Robinhood stock has consistently found support above key moving averages on daily charts. The 20-day simple moving average has been pushing the price higher throughout the year.
The platform processed 2 billion event contracts in Q3 while crypto revenue jumped 98% and the company added 2.3 million new funded accounts in the second quarter.
