Robinhood Hits All-Time High: Is it Too Late to Buy HOOD Stock?

Robinhood Markets HOOD shares hit an all-time high of $85.55 during Wednesday’s trading session, fueled by investor confidence in the company’s strategic growth initiatives. Strong momentum and increased buying activity helped propel the stock to new heights.This year, HOOD stock has soared 122.1%, massively outperforming the industry’s rally of 14.9%. In contrast, shares of Charles Schwab SCHW gained 21.4%, while Interactive Brokers IBKR rose 18.4%.HOOD’s YTD Price Performance Image Source: Zacks Investment ResearchLet’s take a closer look at Robinhood’s fundamentals to assess whether the stock still offers upside or if the rally has already run its course.Robinhood: A Global PlayerRobinhood has evolved significantly since the meme stock frenzy of early 2021, emerging as a serious competitor to established online brokerage players like Interactive Brokers and Schwab. The company intends to become a one-stop shop for building generational wealth globally.To align with its goal of becoming an international player, the company has unveiled several products and services, including expanding its advanced desktop platform, Robinhood Legend, to the U.K. following its launch in the United States in October 2024. This aims to attract more sophisticated retail investors.Additionally, in May, HOOD announced an agreement to acquire Canada-based WonderFi Technologies Inc. in a C$250 million all-cash deal. Besides granting regulatory footing in Canada, the transaction strengthens the company’s position in a rapidly growing crypto market. These efforts align with Robinhood’s ambition to become a global player as the company looks to expand its presence beyond the Americas and Europe into the Asia-Pacific region. During its first Investor Day conference in December 2024, CEO Vlad Tenev mentioned that the company will set up a new office in Singapore in 2025, which will serve as HOOD’s headquarters for the region.The company is likely to launch digital asset trading in Singapore soon, having completed the acquisition of Luxembourg-based Bitstamp, a globally recognized cryptocurrency exchange. The deal provides Robinhood with requisite regulatory approvals, positioning the company to enter Singapore’s expanding digital assets market.HOOD’s Business Diversifying EffortsRobinhood has evolved from a brokerage firm primarily trading in digital assets to a more mature and diversified entity, striving to widen its market and reach. Looking at the numbers, in 2021, it mainly relied on transaction-based revenues (almost 75% of total revenues) to generate income. In 2024, this came down to nearly 56%.HOOD’s 9-Quarter Total Net Revenue Trend Image Source: Robinhood Markets, Inc.Other initiatives by Robinhood reflect its ambition to become a comprehensive financial services provider. In March, the company launched Robinhood Strategies, Robinhood Banking and Robinhood Cortex, a suite of new features, to boost the wealth management offerings for its Robinhood Gold members. Further, it launched the prediction markets hub, allowing customers to trade on the outcomes of several major global events. Initially, the hub will be available across the United States through KalshiEX LLC, a Commodity Futures Trading Commission-regulated exchange.Event contracts gained traction when Robinhood launched them in October 2024, just before the U.S. Presidential elections. Similarly, Interactive Brokers has been actively expanding its event contract offerings to capitalize on rising demand. In April, it launched prediction markets in Canada. Like HOOD, it first introduced event contracts in October 2024, starting with the U.S. election results.Further, in February, Robinhood acquired Gainesville, FL-based TradePMR, a custodial (having $40 billion in assets under administration) and portfolio management platform specializing in services for Registered Investment Advisors. The company gained immediate credibility and resources to cater to wealthier investors seeking advisory solutions. By foraying into the advisory space, the company now directly competes with established players like Schwab and Fidelity Investments.Moreover, in July 2024, Robinhood acquired Pluto Capital Inc. With the integration of Pluto’s advanced capabilities, the company is set to revolutionize the investment experience for its users. Also, as part of a diversification effort, HOOD launched a credit card (expanding in the consumer finance space).Cryptocurrencies: A Vital Tailwind for RobinhoodRobinhood’s focus on the cryptocurrency space, through increased tokenization, enhanced platform capabilities and expansion into EU markets, is expected to drive greater cost efficiency and revenue growth. The company is actively pursuing Markets in Crypto-Assets Regulation (MiCA) licenses, which would enable it to offer crypto services across the European Economic Area, expanding its reach to 27 countries.The acquisition of Bitstamp and the impending WonderFi deal align with this broader strategy. Bitstamp’s core spot exchange, offering more than 85 tradable assets, will significantly strengthen Robinhood’s crypto product suite. Meanwhile, WonderFi brings two of Canada’s leading regulated crypto platforms — Bitbuy and Coinsquare — with more than C$2.1 billion in assets under custody. These will enable Robinhood to provide trading, staking and custody services.As the platform diversifies and enhances its offerings, Robinhood’s cryptocurrency revenues are well-positioned for growth, supported by increasing investor interest in crypto as both a return-generating and diversification tool. Currently, Robinhood supports many major cryptocurrencies — Bitcoin, Ethereum, Dogecoin, Litecoin, Solana and Toncoin.Crypto Revenue Quarterly Trend Image Source: Robinhood Markets, Inc.HOOD Rewards ShareholdersIn 2024, Robinhood announced a share buyback plan (for the first time) to repurchase up to $1 billion of its outstanding common stock. In April, the company increased its existing authorization by $500 million to $1.5 billion. As of April 30, 2025, approximately $833 million worth of shares remained available for repurchase. HOOD plans to complete the remainder of its total authorization over the next roughly two years.Robinhood is on solid ground, with significant cash reserves. As of March 31, 2025, it reported cash and cash equivalents of $4.42 billion.Litigation & Probes Surrounding RobinhoodRobinhood operates in a highly regulated industry and is subject to the scrutiny of numerous authorities. This, thus, exposes the company to regulatory risks, resulting in hefty fines and restrictions that may affect its profitability. In March 2025, Robinhood’s units agreed to pay $26 million to settle allegations by the Financial Industry Regulatory Authority for failing to respond to red flags about potential misconduct and not verifying the identities of thousands of customers.In January 2025, the company agreed to pay a $45 million fine for violating more than 10 securities law provisions. In September 2024, the company faced a $3.9 million penalty to settle failures related to crypto withdrawals. In 2023, the company faced defeat in proceedings at the Massachusetts Supreme Judicial Court regarding the supervision of product features and marketing strategies and paid a fine of $7.5 million.These fines have made investors cautious about the company’s operations and internal control procedures.How to Approach Robinhood Shares Now?Over the past month, the Zacks Consensus Estimate for 2025 and 2026 has been revised upward to $1.23 and $1.47, respectively. This reflects a bullish sentiment among analysts.Estimate Revision Trend Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for HOOD’s earnings implies 12.8% and 21.3% year-over-year growth in 2025 and 2026, respectively.Given the impressive price performance, HOOD shares are currently trading at a massive premium to the industry. The company has a forward price-to-earnings (P/E) of 60.98X compared with the industry average of 14.21X.Price-to-Earnings F12M Image Source: Zacks Investment ResearchMeanwhile, Schwab and Interactive Brokers have forward P/E ratios of 19.26 and 28.65, respectively. Thus, HOOD is expensive compared with its peers, too.Yet, Robinhood’s global expansion, strategic acquisitions, new product launches and diversification efforts will likely help it grow its market share and presence. Rising investor demand for cryptocurrency and solid liquidity are other positives.Nonetheless, concerns have been raised regarding increased regulatory oversight due to the blurred distinction between gambling and trading in the prediction markets hub. Also, foraying into the banking business amid intense competition keeps investors cautious about its success. Uncertainties related to tariffs pose a near-term risk. Hence, investors must keep an eye on macro developments and other headwinds and see how Robinhood is navigating the challenging times. Thus, the stock is a cautious bet for long-term investors, but they should be prepared for short-term volatility.At present, Robinhood carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Charles Schwab Corporation (SCHW): Free Stock Analysis Report Interactive Brokers Group, Inc. (IBKR): Free Stock Analysis Report Robinhood Markets, Inc. (HOOD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks