Robinhood Markets (NASDAQ: HOOD) shares soared over 12% in intraday trading following a dual rating upgrade from a Bank of America analyst.
Analysts led by Craig Siegenthaler have upgraded their recommendation for Robinhood Markets (HOOD) from Underperform to Buy, citing increased retail engagement and accelerating organic growth, expected to boost earnings in 2025-26.
In a note released on Friday, Siegenthaler expressed optimism about Robinhood’s prospects, stating,
“Following the emergence of a new bull market last year, we have monitored a rebound in multiple metrics at Robinhood Markets and expect this to continue through 2026.”
This marks a notable shift in sentiment from Siegenthaler, who has maintained a bearish outlook on the stock since initiating the company’s coverage in late 2021, following its public debut.
Last week, shares of the online brokerage rallied 24% driven in part by retail traders flocking to the platform amid the latest meme stock frenzy.
Despite this recent uptick, Robinhood has faced challenges during its three years as a public company. Retail engagement peaked in 2021 but dropped significantly during the bear market of 2022, bottoming out last year. However, Siegenthaler pointed out that Robinhood has become profitable faster than anticipated by cutting expenses, which supports its current valuation.
The analyst also raised the stock’s price target from $14 to $24, emphasizing that investors often overlook Robinhood’s substantial operating leverage and attractive free cash flow.
Robinhood Markets (NASDAQ: HOOD) Stock Reaction
HOOD stock surged 12.23% to close at $20.09 on Friday. Its value increased by 23.78% this week. Trading activity has witnessed 53,207,440 (53.20 million) shares changing hands, well above the average daily volume of 16.45 million.
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