Robinhood Markets shares advanced 3.8% on Wednesday to $101.93 after a wave of bullish analyst actions and fresh survey data pointed to potentially significant demand for single-stock perpetual futures. The stock touched an intraday high of $103.15 on lower-than-average volume of 13.7 million shares, compared with the typical 26.7 million.
Mizuho's survey of more than 600 active Robinhood users found that 94% would be likely or very likely to trade single-stock perpetual futures if they became available. In addition, 84% of respondents said they would use mostly or exclusively new money for those contracts, which Mizuho managing director Dan Dolev said limits cannibalization of existing equity trading. Dolev described the potential product as “a potential strong positive” and reiterated an Outperform rating and $140 price target.
Robinhood announced on Sept. 29 that it plans to launch perpetual futures trading for U.S. users in the coming months and introduce 24/7 trading for select U.S. equities. However, Johann Kerbrat, Robinhood's senior vice president and general manager of crypto and international, said the company had no single-stock perpetual plans to announce and was still working through the SEC's latest innovation exemption on tokenized stocks. Mizuho said it is plausible the product could arrive over the medium term.
Other analysts also turned more positive. Needham raised its price target to $126 from $123, Rosenblatt initiated coverage with a Buy rating and a $135 target while calling Robinhood a “generational growth story,” JPMorgan lifted its target to $115 from $103 but stayed Neutral, and Scotiabank maintained a $136 target. MarketBeat data showed a Moderate Buy consensus and an average target of $130.29 among 35 analysts. Insider selling totaled about $128 million over the past 90 days, with transactions under 10b5-1 plans.
In its most recent report on July 29, Robinhood posted earnings of $0.62 per share versus a $0.44 estimate and revenue of $1.31 billion, up 32.5% year over year. The company has a market capitalization of $91.64 billion, a price-to-earnings ratio of 44.90, and a beta of 2.35. Coinbase's September filing to list perpetual futures tied to large-cap U.S. stocks added further evidence of industry interest in the product category.
