HOOD’s stock price rose more than 2% on Monday, continuing a recovery that began on Friday when it rose more than 13% as US equities and the crypto market pulled back.
Summary
- Robinhood’s share price remains in a technical bear market after crashing 46% from its all-time high.
- The company will publish its financial results on Tuesday this week.
- Analysts expect revenue to continue to grow in the fourth quarter.
Shares of Robinhood jumped to $84, up sharply from a year-to-date low of $72 as the focus is on the upcoming quarter’s earnings.
Robinhood will publish its Q4 earnings on Feb. 10
A key catalyst for HOOD stock is its upcoming fourth-quarter earnings, which will add color to its growth and profitability trajectory.
Data compiled by Yahoo Finance shows that the estimated revenue jumped 32% in the fourth quarter to $1.34 billion, driven by the options market and its acquisition of Bitstamp.
If this estimate is correct, annual revenue will be $4.53 billion, up 53% from 2024. Its annual earnings per share are expected to reach $2.04, up significantly from the $1.56 it made in the same period last year.
Robinhood’s business has flourished over the past few years, as competition in the trading industry has increased, with companies like Webull and SoFi taking market share.
The latest results showed that its funded customers increased to over 26.8 million from 24.3 million in Q3’24. Robinhood Gold subscribers increased to 3.88 million, while the platform’s total assets increased to $333 billion.
The company has done well because of its strong position in the options, stocks, and crypto markets. It has also benefited from continuous innovation, which has enabled it to introduce tokenized goods into its European market.
The company also tapped into the growing forecast market, which handles billions of dollars every week.
Robinhood stock tends to be very volatile after its earnings release. For example, it fell from $139 to $125 when it released its results in November. The pullback was swift, pushing the stock to $102 a few weeks later.
Wall Street analysts are very focused on the company. Needham analysts recently reiterated their buy rating with a $135 target. Cantor Fitzgerald has a strong buy rating, while Piper Sandler has an overweight rating.
Technical analysis of HOOD stock price
The daily time chart shows that HOOD’s stock price remains in a strong downward trend, from a high of $154 in October to the current $82.
Robinhood stays below 50% Fibonacci Retracement and Supertrend indicator. Worse still, the spread between the 50-day and 200-day Exponential Moving Averages has continued to narrow, suggesting that it may be a dying pattern.
Therefore, the most likely price forecast for HOOD is very bearish, with a target view of $71.40, which is the lowest this year. A move below that level would indicate further downside, potentially reaching the 78.6% Fibonacci Retracement level at $60.
