Robinhood Price Target Raised – Earnings Forecast, and Multiple Increased (HOOD)

Robinhood Markets, Inc. (NASDAQ: HOOD) is enjoying a banner year, fueled by a resurgence in retail trading, a strategic expansion into cryptocurrency, and a string of positive earnings reports. Ropbinhood's stock price closed out the week at $83.03, bringing the gains through June to 22.14% entering the final trading day of the month.

New highs have also been hit at $85.55, and with HOOD having already doubled YTD (+110%), the question is whether there could be a pullback in sight, or whether further price discovery, or multiple expansion will persist.

Supporting the bullish case, BofA raised its price target on HOOD to $95, citing an improved regulatory outlook for digital assets and anticipating the passage of stablecoin legislation. The raise came as BofA increased both their earnings outlook on the firm through to 2027, as well as their multiple, from 30 to 40 times.

Also supporting a higher move were Compass, raising its price target on Friday to $96, seeing the business firing “on all cylinders” in June, and with further catalysts to come.

The company's remarkable turnaround is rooted in several key factors. Robinhood has achieved six consecutive profitable quarters, boasting an enviable 91% gross profit margin. This profitability, coupled with a renewed interest in both equities and cryptocurrencies among retail investors, has driven significant growth in user engagement and transaction volume.

The acquisition of Bitstamp, anticipated to boost cryptocurrency trading volumes in the latter half of 2025, further solidifies Robinhood's position in the digital asset space.

However, despite the impressive run, some analysts remain cautious. The average analyst price target sits at $70.38, significantly below the current trading price, suggesting that some believe HOOD may be overvalued in the short term. This discrepancy highlights the inherent risk associated with investing in high-growth stocks, particularly those trading at premium valuations.

Robinhood's P/E ratio of +45x and Price/Book ratio of 9.2x are considerably higher than its sector peers, raising concerns about whether the company can justify its lofty valuation.

Robinhood's future success hinges on its ability to maintain its current growth trajectory, navigate regulatory challenges, and effectively manage its expenses. The company has demonstrated its ability to disrupt the traditional brokerage industry and attract a new generation of investors. However, its high valuation, dependence on market sentiment, and exposure to regulatory risks warrant careful consideration.