- Anticipated SEC changes under a Trump administration could allow Robinhood to expand offerings and list more cryptocurrency tokens.
- Robinhood’s share price target raised from $30 to $51 by Bernstein, reflecting a potential market cap above $45 billion.
According to a recent analysis by Bernstein analysts, a potential Donald Trump administration could create a favorable regulatory environment for cryptocurrencies, which might significantly increase Robinhood’s revenue.
The analysts suggest that under a more crypto-supportive Securities and Exchange Commission (SEC), Robinhood could expand its cryptocurrency offerings, which currently are limited under the current SEC leadership by Gary Gensler.
The report details that the trading platform has been conservative in its crypto offerings due to strict current regulations but anticipates that a change in leadership could lead to the listing of more tokens and the introduction of additional crypto-related products such as stablecoins and staking services.
As a result, Bernstein has updated Robinhood’s revenue forecast for 2025 to $4.19 billion, an increase from the previous $3.85 billion estimate.
Additionally, Bernstein has adjusted the target price for Robinhood’s shares from $30 to $51, reflecting a potential growth in market capitalization to above $45 billion, compared to its current trading price around $35. This adjustment is based on the expectation of regulatory changes that could enable the platform to offer more diverse and extensive crypto services.
The report notes that while Robinhood currently lists only 15 tokens to maintain compliance with SEC regulations, its competitors like Coinbase offer more than 250 tokens. However, since the elections, Robinhood has added four more tokens to its offerings and is venturing into previously avoided areas such as staking and lending.
Despite regulatory constraints, Robinhood has demonstrated growth in its crypto revenues, which have increased by 160% year-over-year. The analysts believe Robinhood is poised to expand further, particularly into the EU and UK markets, by introducing new crypto products and enhancing its token listings.
Robinhood’s recent strategic activities include the acquisition of crypto exchange Bitstamp for $200 million and its involvement in launching a new dollar-pegged stablecoin, indicating its commitment to enhancing its crypto services.
Robinhood Markets (HOOD) currently trades at $35.24 USD, up 0.69% today, with strong performance metrics including a 176.61% year-to-date gain and a 335.06% increase over the past year, reflecting bullish momentum.
The company has a market cap of $31.15 billion USD and a price-to-earnings ratio of 59.65, driven by demand for its expanding crypto services, especially following Bitcoin’s recent all-time highs.
With its next earnings report set for January 23, 2024 (EPS estimate of $0.18 USD, revenue estimate of $662.38 million USD), Robinhood is positioned for further growth.
Key technical levels to watch include resistance at $37 USD and support at $30 USD, as its focus on crypto and advisory services bolsters long-term prospects.
