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Robinhood Markets, Inc. (HOOD)

Overvalued
Financial ServicesCapital MarketsUnited States

Fundamental

62

Price

$112.50

Market Cap

$108.63B

Part 1 · What the company is worth

Overview

Robinhood is a commission-free brokerage app that lets people trade stocks, options and cryptocurrencies from their phone. It grew by removing the trading fees that traditional brokers used to charge, and now earns money in ways that are less visible to the user, mainly by routing customer orders to market makers and by lending out customers' idle cash and margin balances.

How it makes money

Transaction-based revenue comes from payment for order flow — market makers pay Robinhood for the right to execute customer trades — so it scales with how much customers trade rather than with a per-trade fee charged to them. Net interest revenue comes from lending customer cash, securities and margin balances, which rises with interest rates and with how much customers keep on deposit. A third, smaller stream comes from the Robinhood Gold subscription and other product fees.

Revenue by segment

Net Interest Revenue33.9%

Interest earned on customer cash, securities lending and margin loans. Now Robinhood's largest single revenue source, and sensitive to interest rate levels.

Options Trading25.1%

Payment for order flow earned on options trades — historically Robinhood's single largest transaction revenue source.

Cryptocurrency Trading20.2%

Payment for order flow on crypto trades. The most volatile revenue line, moving with crypto prices and trading enthusiasm.

Other Revenue14.2%

The Robinhood Gold subscription, other transaction-based fees, and miscellaneous product revenue.

Equities Trading6.7%

Payment for order flow on stock trades — a smaller share than options or crypto despite equities being the most common trade type.

Competitive moat

Switching costs · Narrow

Once a customer's portfolio, tax records and linked bank account sit on Robinhood, moving them to another broker is enough hassle that many do not bother, and Gold-tier customers who use its debit card and cash management are further tied in. But the underlying trading products are nearly identical across brokers, and price-sensitive or professional traders switch fairly easily.

What drives demand

Cyclical

Trading activity, and therefore transaction revenue, rises with market enthusiasm and volatility and falls when markets are quiet or falling and retail investors pull back. Net interest revenue depends on interest rate levels set by central banks, a separate cycle Robinhood does not control. Together this makes revenue considerably less predictable than a typical financial services business.

Key risks

  • Dependence on trading volume and volatility — Transaction-based revenue depends on customers trading actively, particularly in options and crypto, and falls sharply when markets are calm or retail interest fades.
  • Interest rate sensitivity — Net interest revenue, now the largest single line, moves directly with the interest rates central banks set. A sustained rate-cutting cycle would remove a major source of revenue.
  • Regulatory scrutiny of payment for order flow — Payment for order flow, which underpins most of Robinhood's transaction revenue, has repeatedly drawn regulatory attention over whether it gives customers the best possible trade execution; a ban or restriction would remove the company's main revenue mechanism.
  • Concentrated, cost-sensitive customer base — Robinhood's user base skews toward younger, more price-sensitive retail traders who are quicker to reduce activity or move balances elsewhere when conditions turn against them.

The case for

Buyers argue that Robinhood has successfully broadened beyond commission-free stock trading into options, crypto, retirement accounts and banking-like products, that Robinhood Gold subscribers are stickier and more valuable customers, and that net interest revenue provides a steadier base even when trading activity cools.

The case against

Sellers fear that revenue remains built on trading enthusiasm and interest rates rather than on a durable recurring base, that a payment-for-order-flow ban or restriction would remove the core revenue mechanism overnight, and that Robinhood's younger, more speculative customer base pulls back faster than average when markets turn.

Written by the editors, published on August 18, 2026

Direct competitors

Who this company fights with for the same customers

Compare

Generated on September 18, 2026 with claude-haiku-4-5 — shared with all users

P/E: 89.2Score: 75Market cap: $3.65B

Webull is the closest analogue to Robinhood: a mobile-first, commission-free US brokerage for self-directed retail investors that earns most of its revenue from payment for order flow on the same stocks, options and crypto trades.

P/E: 17.8Score: 75Market cap: $169.99B

Schwab, which absorbed TD Ameritrade, is the largest US retail brokerage and competes for the same self-directed customers and the same brokerage accounts, offering zero-commission stocks and ETFs plus the retirement accounts Robinhood has been adding.

P/E: 34.0Score: 66Market cap: $5.75B

Interactive Brokers targets the same active traders Robinhood monetises most — high-frequency options and margin users — and its IBKR Lite tier offers commission-free US stock trading to the same retail segment.

P/E: 44.8Score: 43Market cap: $52.55B

Coinbase competes directly for Robinhood's crypto trading volumes, offering US retail investors the same buying and selling of digital assets that forms one of Robinhood's largest transaction revenue lines.

P/E: 32.1Score: 49Market cap: $21.70B

SoFi Invest goes after the same young, mobile-first American customers with commission-free trading bundled into a banking app, the same combination of brokerage and cash products Robinhood sells.

Fidelity Investments (FMR LLC)Not tracked

Fidelity is a privately held brokerage that competes for the same retail brokerage and retirement accounts with zero-commission stock and ETF trading and a free cash-management offering aimed at the same first-time investors.

Balance Sheet & Liquidity

Revenue

$4.93B

Trailing 12 months (through 6/30/2026)

Net Income

$2.07B

Trailing 12 months (through 6/30/2026)

Free Cash Flow

-

Total Equity

$9.15B

Total Liabilities

$28.99B

Current Ratio

1.22

Interest Coverage

-

Debt/EBITDA

-

Earnings Per Share

Revenue & Net Income

Free Cash Flow

Income Breakdown

Historical statement

Margins over time

Debt over time

How heavy the debt is

Growth grid

Growth — Revenue

Fair Value Estimation

BankOvervalued

Fair Value

$80.73

Current Price

$112.50

Margin of Safety

-39.4%

Fair Value Range

$52.48 - $108.99

Spread across the valuation methods used, not a statistically calibrated confidence interval.

Estimation Methods

Analyst price target:$130.08
Discounted cash flow (DCF):Not applicable to this type of company
Earnings multiple (P/E):$104.73
Graham growth formula:Not applicable to this type of company
Earnings power value (EPV):Not applicable to this type of company
Justified P/B:$13.22
Dividend discount (Gordon):Not enough data to compute it
P/FFO, funds from operations:Not applicable to this type of company
Mid-cycle earnings:Not applicable to this type of company
Revenue multiple:Not applicable to this type of company
Analyst Consensus:Strong Buy (27B / 6H / 1S)
Last Earnings Surprise:+6.69%

Valuation Metrics

P/E Ratio

49.78

ROE

20.6%

P/B Ratio

-

P/FCF

-

Gross Margin

-

ROIC

-

Profitability Radar

Value Creation (Economic Moat)

ROIC

-

WACC

17.9%

ROIC − WACC

-

Fundamental Analysis Criteria

Passed (11)

  • EPS shows upward trend
  • Price CAGR 47.20%
  • Debt/Equity ratio
  • Current Ratio
  • Return on Tangible Assets
  • Low reliance on intangibles
  • ROE 22.7%
  • Revenue Growth 5Y 36.1%
  • Analyst Consensus 79% Buy
  • PEG Ratio 0.27
  • Share Dilution 1.6%

Failed (5)

  • DCF valuation (Unknown)
  • Earnings Surprise avg 2.3%
  • Earnings Quality (OCF/NI) 0.12
  • Net Margin Trend 42.0% vs 50.1%
  • Piotroski F-Score 3/9

Unavailable (11)

  • ROIC NaN%
  • Gross Margin NaN%
  • P/FCF NaN
  • P/B Ratio NaN
  • Dividend Payout NaN%
  • Operating Margin NaN%
  • Positive Free Cash Flow
  • CapEx intensity
  • Interest Coverage
  • Debt/EBITDA
  • Price below Graham Number

Piotroski F-Score

3/9

Serious financial concerns

score
criteria

Earnings Quality

0.12

Low quality: investigate accounting

Share Dilution

1.6%

Share count is stable

Institutional Holdings

Governance

Executive Team

NameTitleAge
Mr. Vladimir TenevCo-Founder, President, CEO & Chairman of the Board38
Mr. Baiju Prafulkumar BhattCo-Founder & Director40
Mr. Daniel M. Gallagher Jr., J.D.Chief Legal, Compliance & Corporate Affairs Officer52
Mr. Steven M. QuirkChief Brokerage Officer60
Mr. Shiv Kumar VermaChief Financial Officer40
Ms. Stephanie Jannie Guild C.F.A.Chief Investment Officer-
Ms. Dara Ann BazzanoChief Accounting Officer & Principal Accounting Officer56
Mr. Chris KoegelVice President of Corporate Finance & Investor Relations-
Ms. Nora ChanSenior Director of Communications-
Ms. Connie SchanChief People Officer-

Audit Risk

3

Board Risk

10

Compensation Risk

9

Shareholder Rights Risk

10

Part 2 · The price and when to enter

This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.

Documents

  • Annual Report (10-K)

    A yearly overview of the business, its financial results, and the risks it faces.

    Filed on 2026-02-18

    View document
  • Quarterly Report (10-Q)

    A snapshot of financial performance for the most recent three-month period.

    Filed on 2026-07-30

    View document
  • Current Report (8-K)

    An announcement of a major event, such as a leadership change or big news.

    Filed on 2026-07-29

    View document

via SEC EDGAR

Income History

via SEC EDGAR

Latest News

Recent headlines for HOOD, sourced from Markets Gazette.

  • 22h agoPOSITIVE
    Robinhood punta a dare un vantaggio ai trader con 2 nuove funzionalità

    Robinhood (HOOD) is enhancing its platform for active traders with significant new features, including integrated AI-driven 'agentic trading' for autonomous order execution and 24/7 weekend stock trading. The company also introduced prediction contracts on corporate KPIs and perpetual futures. CEO Vlad Tenev highlighted the goal of providing a competitive edge to its 28 million users. These advancements, aimed at institutional-style high-frequency trading for retail investors, come as Robinhood stock has already surged approximately 75%. The move signals Robinhood's aggressive strategy to capture a larger share of the active trading market.

  • 22h agoNEUTRAL
    Robinhood to Offer Weekend Equities Trade; Cal-Maine Falls on Sales Miss | Stock Movers

    Robinhood Markets Inc. is set to introduce weekend trading for equities, a pioneering move in modern US markets. This feature will allow clients to trade a curated selection of stocks and ETFs on Saturdays and Sundays. The announcement comes as the company aims to enhance its service offerings and capture a larger market share. While this innovation could attract new users and increase trading volume, its direct financial impact and long-term success remain to be seen. The news also coincides with other market movements, including Cal-Maine Foods missing sales estimates and Concentrix forecasting lower revenue.

  • 2d agoPOSITIVE
    Robinhood just rolled out trading agents to millions—and investing may never be the same

    Robinhood has launched AI-powered trading agents for millions of its users, integrating models from OpenAI and Anthropic. This move aims to democratize sophisticated trading strategies, potentially enhancing user engagement and transaction volumes on the platform. The introduction of AI agents could streamline investment decisions, making markets more accessible and efficient for a broader audience. For investors, this innovation signifies Robinhood's commitment to technological advancement and its strategy to capture a larger share of the retail trading market by offering cutting-edge tools.

  • 15d agoNEGATIVE
    US charges ex-Robinhood engineers over alleged pre-listing crypto trades

    US authorities have charged former Robinhood Markets Inc. engineers with allegedly profiting over $50,000 each through pre-listing trades of Hyperliquid perpetuals. This development casts a shadow over the company's internal controls and regulatory compliance, potentially impacting investor trust. While the alleged activity did not directly involve Robinhood's own stock or core operations, such accusations can lead to increased scrutiny, fines, and reputational damage, which may negatively affect the stock price.

  • 17d agoNEUTRAL
    Robinhood CEO says issuers should not have veto over tokenized stocks

    Robinhood CEO Vlad Tenev expressed his views on tokenized stocks, stating that issuers should have a say only when tokenized products alter shareholder rights or company obligations. However, Tenev believes issuers should not have veto power over the creation of separate instruments that are merely backed by shares. This stance could influence regulatory discussions and the development of digital asset frameworks, potentially impacting how financial instruments are structured and traded in the future. Investors will be watching for further clarity on these evolving market structures.

  • 20d agoNEUTRAL
    Robinhood’s crypto volume increases 61% in August, still down 38% YoY

    Robinhood Markets Inc. reported a significant 61% month-over-month increase in cryptocurrency trading volume for August, reaching $10.1 billion, largely driven by activity on the Bitstamp platform. Despite this surge, the company's overall crypto volume remains down 38% year-over-year, with trading on the Robinhood app itself declining 46% from the previous year. This mixed performance highlights a recovery in crypto trading interest but also a continued year-over-year contraction, presenting a complex picture for investors assessing the company's growth trajectory in the digital asset space.

  • 23d agoNEUTRAL
    Robinhood takes stakes in Crypto.com, OG.com in prediction markets deal

    Robinhood is expanding its prediction markets by taking stakes in Crypto.com and OG.com. The deal will see Robinhood route event contracts through OG.com's CFTC-regulated infrastructure. This strategic move aims to bolster Robinhood's presence in the burgeoning prediction markets sector, leveraging established infrastructure for regulatory compliance and operational efficiency. While the specific financial terms of the stakes are undisclosed, the partnership signifies Robinhood's commitment to diversifying its offerings beyond traditional brokerage services.

  • 24d agoPOSITIVE
    Perché il nuovo upgrade rialzista su Robinhood può essere un campanello d'allarme

    Robinhood Markets (NASDAQ: HOOD) experienced a volatile week, concluding at $122.11. Wall Street sentiment turned bullish, with Morgan Stanley upgrading the stock from Equal Weight to Overweight and raising its price target from $124 to $150. Piper Sandler increased its target to $145, and Scotiabank initiated coverage with an Outperform rating and a $136 target. This optimism fueled a 16.6% surge on Thursday to $124.72. Despite a slight pullback on Friday, the analyst upgrades suggest a positive outlook for the brokerage, potentially driven by perceived platform strengths and growth opportunities.

  • 28d agoPOSITIVE
    Analisi del prezzo di HOOD mentre i principali indicatori di Robinhood Chain aumentano

    Robinhood's stock (HOOD) has surged over 70% year-to-date, reaching $110 in after-hours trading. This rally is significantly driven by the rapid growth of Robinhood Chain, launched in July. The chain has achieved a total value locked (TVL) of $783 million, making it the eleventh largest in the crypto sector and outperforming many established Layer-1 and Layer-2 networks. This strong performance in a competitive crypto landscape suggests increasing adoption and utility for Robinhood's blockchain ecosystem, potentially boosting investor confidence in the company's future growth prospects.

via Markets Gazette