TLDR
- Robinhood missed Q1 earnings and revenue estimates on April 28, mainly due to weak crypto trading, sending the stock down nearly 12%.
- Cathie Wood’s ARK Invest bought roughly $39.7 million worth of HOOD across three funds the day after the miss.
- Cantor Fitzgerald kept its Overweight rating and $110 price target, saying preliminary April equity and options volumes are tracking toward their highest monthly level this year.
- KBW cut its price target to $65 from $75, warning that falling crypto and options take rates could pressure earnings through 2028.
- Robinhood’s planned prediction markets platform, Rothera, is being watched as a potential new revenue driver.
Robinhood (HOOD) missed its first-quarter earnings and revenue estimates on April 28. The culprit was weaker crypto trading activity. The stock dropped nearly 12% on the news and is down about 37% this year.
The day after the earnings miss, ARK Invest moved in. Cathie Wood’s firm bought roughly $39.7 million worth of HOOD across three funds. That makes Robinhood one of ARK’s top holdings, accounting for around 3% of each fund’s portfolio.
ARK also picked up 2.4 million shares of Intellia Therapeutics (NTLA) for $31.8 million, and 191,174 shares of Kratos Defense (KTOS) for $11.8 million. On the sell side, it offloaded 243,147 shares of its own Bitcoin ETF (ARKB) for around $1.35 million.
The move into HOOD came as Wall Street analysts were largely shrugging off the Q1 miss.
Cantor Fitzgerald kept its Overweight rating and $110 price target. The firm pointed to early April trading data, noting that equity and options volumes are tracking toward their highest monthly level this year. It described the earnings miss as tied more to broader market conditions than anything fundamentally wrong with the business.
Bulls and Bears Divided on the Outlook
Compass Point also stayed bullish, maintaining a Buy rating while trimming its price target slightly to $107. The firm said the market reaction looked “backwards looking,” given expectations for a stronger Q2.
Bernstein held its Outperform rating and $130 price target. Analysts there pointed to signs of stabilization in crypto, noting that April hadn’t seen further declines in prices, while equities and options remained solid.
Not everyone is buying the recovery story. KBW, which already had one of the lowest price targets on the stock, cut it further to $65 from $75. The firm rates HOOD a Hold and warned that declining transaction fees across both crypto and options are not a short-term problem.
“Capture rates missing across the board,” KBW analysts said. They trimmed earnings estimates all the way through 2028.
Prediction Markets in Focus
Beyond trading revenue, investors are paying attention to Robinhood’s new ventures. The company’s planned prediction markets platform, Rothera, has caught the eye of several analysts.
Cantor flagged it as a potential driver of future revenue and margin expansion. Growth in event-based contracts and upcoming product launches are being closely watched as possible catalysts.
HOOD was up about 3% on Thursday following ARK’s purchases. Peer Coinbase (COIN) also rose around 3% on the day, though it too is down about 19% year-to-date.
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