Robinhood Markets (NASDAQ:HOOD) Stock Price Down 3.9% – Should You Sell?

Robinhood Markets, Inc. (NASDAQ:HOOD) shares dropped 3.9% on Tuesday . The company traded as low as $117.08 and last traded at $117.34. 25,767,079 shares traded hands during trading, a decline of 8% from the average daily volume of 27,864,742 shares. The stock had previously closed at $122.11.

Key Stories Impacting Robinhood Markets

Here are the key news stories impacting Robinhood Markets this week:

• Positive Sentiment: Prediction markets expansion: Robinhood announced a multiyear agreement with OG.com to provide exchange infrastructure and clearing for event contracts, while also adding Crypto.com’s yes-or-no contracts. Robinhood will take minority stakes in Crypto.com and OG.com, broadening access to football and other prediction markets ahead of the NFL season. The business is described as one of Robinhood’s fastest-growing areas. Reuters article
• Positive Sentiment: New investment-banking opportunity: Robinhood was named an underwriter for smart-ring maker Oura’s initial public offering. The role could help the company build issuer relationships, offer customers greater IPO access and create a new fee-based revenue stream beyond brokerage and trading. Wall Street Journal article
• Positive Sentiment: More bullish analyst views: Cantor Fitzgerald raised its price target to $150 and maintained an Overweight rating. Recent bullish commentary has cited prediction-market momentum and Robinhood’s expanding product mix. TheStreet article
• Neutral Sentiment: Strong recent momentum: Robinhood has rallied sharply in recent weeks, increasing investor attention and raising expectations for continued growth. The company’s prior quarter included revenue growth and earnings above consensus, but those results are already reflected in a demanding share valuation. Zacks article
• Negative Sentiment: Valuation and sentiment risks: Commentary points to a high earnings multiple after the rally, while Robinhood’s own data reportedly suggests some customers have been selling. Questions also remain about regulatory challenges for prediction markets and whether the recent tokenization-related enthusiasm can persist. Barchart article

Analyst Ratings Changes

A number of brokerages have recently commented on HOOD. Mizuho lifted their price objective on shares of Robinhood Markets from $115.00 to $130.00 and gave the company an “outperform” rating in a research report on Thursday, July 2nd. Zacks Research upgraded shares of Robinhood Markets from a “hold” rating to a “strong-buy” rating in a research note on Thursday, September 3rd. Sanford C. Bernstein reiterated an “outperform” rating on shares of Robinhood Markets in a report on Tuesday. Scotiabank assumed coverage on Robinhood Markets in a research report on Wednesday, September 2nd. They set a “sector outperform” rating and a $136.00 price target on the stock. Finally, China Renaissance initiated coverage on Robinhood Markets in a research note on Tuesday, July 7th. They issued a “buy” rating on the stock. One equities research analyst has rated the stock with a Strong Buy rating, twenty-three have given a Buy rating and three have given a Hold rating to the stock. According to data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average target price of $129.00.

Robinhood Markets Trading Down 3.9%

The company has a market cap of $105.50 billion, a price-to-earnings ratio of 51.69, a PEG ratio of 2.50 and a beta of 2.34. The company has a current ratio of 1.22, a quick ratio of 1.22 and a debt-to-equity ratio of 0.23. The business’s 50 day moving average price is $103.14 and its 200-day moving average price is $88.67.

Robinhood Markets (NASDAQ:HOOD) last announced its quarterly earnings results on Wednesday, July 29th. The company reported $0.62 EPS for the quarter, beating analysts’ consensus estimates of $0.44 by $0.18. The business had revenue of $1.31 billion for the quarter, compared to analyst estimates of $1.29 billion. Robinhood Markets had a net margin of 42.01% and a return on equity of 22.43%. Robinhood Markets’s quarterly revenue was up 32.5% on a year-over-year basis. During the same quarter in the prior year, the business earned $0.42 EPS. On average, equities analysts anticipate that Robinhood Markets, Inc. will post 2.09 EPS for the current fiscal year.

Insider Buying and Selling

In other news, CEO Vladimir Tenev sold 375,000 shares of the stock in a transaction that occurred on Monday, July 6th. The stock was sold at an average price of $116.17, for a total transaction of $43,563,750.00. Following the transaction, the chief executive officer owned 375,000 shares in the company, valued at approximately $43,563,750. This trade represents a 50.00% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Steven Quirk sold 24,416 shares of Robinhood Markets stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $120.33, for a total value of $2,937,977.28. Following the sale, the insider directly owned 77,839 shares of the company’s stock, valued at approximately $9,366,366.87. The trade was a 23.88% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 626,283 shares of company stock valued at $69,070,083 in the last ninety days. 13.48% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Robinhood Markets

Institutional investors and hedge funds have recently modified their holdings of the business. CYBER HORNET ETFs LLC increased its position in Robinhood Markets by 527.8% during the fourth quarter. CYBER HORNET ETFs LLC now owns 226 shares of the company’s stock worth $26,000 after acquiring an additional 190 shares during the period. Elyxium Wealth LLC bought a new stake in Robinhood Markets in the 4th quarter valued at about $27,000. MV Capital Management Inc. acquired a new position in shares of Robinhood Markets during the 4th quarter worth approximately $27,000. C M Bidwell & Associates Ltd. bought a new position in shares of Robinhood Markets during the second quarter worth approximately $27,000. Finally, Swiss RE Ltd. bought a new position in shares of Robinhood Markets during the fourth quarter worth approximately $27,000. 93.27% of the stock is currently owned by institutional investors and hedge funds.

About Robinhood Markets

Robinhood Markets, Inc (NASDAQ: HOOD) is a U.S.-based financial services company best known for its mobile-first brokerage platform that aims to “democratize finance for all.” Founded in 2013 by Vladimir Tenev and Baiju Bhatt and headquartered in Menlo Park, California, the company built early traction by offering commission-free trading and a simplified user experience that attracted a large base of retail investors.

Robinhood’s core products and services include a mobile app and web platform for trading U.S.