Robinhood Markets (HOOD) is scheduled to report its fourth-quarter earnings on Thursday after the closing bell, as parts of the commission-paid trading platform are trading at all times. that low.
Here are the consensus estimates that Wall Street analysts expect, according to Bloomberg data.
Adjusted earnings (losses) per share: -.42 cents compared to -$ 2.06 reported in Q3
Revenue: $ 370.92 million compared to $ 364.92 million in Q3
The trading platform is expected to provide an update to its new crypto wallet, which began beta testing in January. 20. Robinhood is laser focused on launching a new crypto product as it aims to expand its platform and become a destination wallet for customers.
The company saw a slowdown in trading in the third quarter of last year where crypto revenue dropped 78% from the previous three months. In the second quarter, Robinhood posted record revenue from crypto transactions fueled by the massive popularity of Dogecoin (DOGE-USD).
Shares of the investing platform dropped about 60% from their July IPO price of $ 38, amid a slowdown in retail trading and less stimulus cash on hand. Investors are also cutting back on stocks that benefited during the pandemic amid continued inflation and expected rate hikes from the Fed.
“Robinhood has all the tailwinds you want to run until their IPO. The problem they have is all of them are usually uninjured in the last eight to 10 months,” said Hugh Tallents, senior partner at management consultancy cg42 , in Yahoo Finance.
“They had five years of success with the business plan prepared at the price of that IPO. Now you’re starting to see it valued more like a fin, than a tech, and that bulk isn’t really attractive. , ”Tallents added.
Last year, Robinhood had a backlash over its decision to temporarily restrict trading with video game retailer GameStop (GME) and other so -called meme stocks. The trading app then faces regulatory scrutiny on the gamification of stock trading, and its use of payment for order flow (PFOF), where brokers funnel trading orders to market makers and receive payment. for their implementation. More recently, Robinhood has relied less on controversial practice as a way to bring in money, with the PFOF declining as a percentage of quarterly revenue per quarter.
With its market cap of just under $ 11 billion, and approximately 22.5 million active users, the company may be starting to look like an attractive acquisition target.
One scenario might be “someone like a PayPal who says they’re interested in getting into the brokerage space, they might take it for cents on the dollar because it’s related to the IPO,” Tallents said.
“They’re definitely a decent fit with them up to lower balance, higher frequency of transaction thinking, engagement mindset, technology first, potential to measure,” he added.
The stock has eight Buy, seven Hold, and two Sell ratings from analysts, with an average price target of $ 29 per share.
Ines is a markets reporter covering stocks from the floor of the New York Stock Exchange. Follow him on Twitter at @ines_ferre
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