Robinhood (NASDAQ:HOOD) fell 4% Wednesday, even as Bernstein and StoneX stuck with bullish ratings after the company’s slight third-quarter earnings miss.
Why Wall Street Is Looking Past the Miss
Robinhood posted revenue of $1.42 billion, falling roughly $5 million short of consensus, while crypto revenue dropped 55% to $120 million from a year earlier.
StoneX analyst Mark Palmer told The Block that the stock’s 10% drop after results was an overreaction, noting an unrealized loss on Robinhood Ventures Fund I dragged earnings per share down by $0.07.
Excluding that loss, EPS actually beat consensus by $0.60. StoneX kept its Buy rating and $170 target.
Meanwhile, Bernstein analysts led by Gautam Chhugani wrote in a note cited by The Block that they kept their Outperform rating and $160 price target, arguing Robinhood’s crypto business is shifting from retail trading into what they called an "infrastructure business."
They expect three growth drivers to generate roughly 25% of total revenue by 2028:
- Prediction markets
- Perpetual futures
- Robinhood Chain, launched in July
Robinhood Chain contributed $26 million in net revenue during its first full quarter on mainnet.
Excluding that, crypto revenue fell 6% quarter over quarter to $94 million, partly due to growth in Robinhood Earn, its lower-margin stablecoin product, which now holds more than $500 million in assets.
Meanwhile, prediction markets generated $173 million in quarterly revenue, with non-sports contracts, including crypto, commodities and financial markets, doubling their share to roughly 30%.
Why October’s Soft Start Worries Some Analysts
As Benzinga reported, Needham’s John Todaro noted trading activity hit record highs across Robinhood’s business lines in Q3, but October volumes are tracking well below that quarterly average.
He kept a Buy rating while cutting his target to $116 from $126.
Here’s how other analysts reacted:
- Scotiabank’s Lance Jessurun: cut his target to $124 from $136, citing GAAP EPS down 16% to 51 cents, partly from $67 million in Robinhood Ventures losses
- Cantor Fitzgerald’s Ramsey El-Assal: kept an Overweight rating and $150 target, pointing to Robinhood Chain, international expansion, perpetual futures, and new OKX and Ripple partnerships as catalysts ahead
- Benchmark’s Mark Palmer: kept a Buy rating and $170 target despite record revenue, tying the stock’s 7% drop to EPS missing by 5 cents and monthly active users of 13 million falling short of the 14.4 million expected
Where HOOD Stands Technically
Robinhood trades below rising trendline support and all four major EMAs, with RSI near 34 signaling weak momentum that hasn’t yet reached oversold territory.
Key levels for HOOD:
- $89: immediate support
- $95: first resistance zone on any recovery
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