{"id":331825,"date":"2021-08-29T06:42:00","date_gmt":"2021-08-29T03:42:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/the-ratings-game-why-robinhood-may-be-more-than-a-meme-stock-phenomenon\/"},"modified":"2021-08-29T06:42:00","modified_gmt":"2021-08-29T03:42:00","slug":"the-ratings-game-why-robinhood-may-be-more-than-a-meme-stock-phenomenon","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/the-ratings-game-why-robinhood-may-be-more-than-a-meme-stock-phenomenon\/","title":{"rendered":"#The Ratings Game: Why Robinhood may be more than a \u2018meme stock phenomenon\u2019"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a407eace664d\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a407eace664d\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/the-ratings-game-why-robinhood-may-be-more-than-a-meme-stock-phenomenon\/#Analysts_like_the_companys_opportunities_in_banking_and_beyond\" >Analysts like the company\u2019s opportunities in banking and beyond<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/the-ratings-game-why-robinhood-may-be-more-than-a-meme-stock-phenomenon\/#Emily_Bary\" >Emily Bary<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#The Ratings <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">Game<\/a>: Why Robinhood may be more than a \u2018meme stock phenomenon\u2019<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"Analysts_like_the_companys_opportunities_in_banking_and_beyond\"><\/span>\n  Analysts like the company\u2019s opportunities in banking and beyond<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div class=\"article__side\">\n<div class=\"container--sticky not-active\">\n<div id=\"cx-next\" data-nosnippet>\n              <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000384150\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div data-layout=\"\n                inline\" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetArticleReader\n              \n              inline\n  article__inset\n          article__inset--type-InsetArticleReader\n              article__inset--inline\n  \"><\/p>\n<div class=\"media-object-article-reader\">\n<div class=\"audioplayer\" data-sbid=\"WP-MKTW-0000384150\" role=\"region\" aria-label=\"Listen to Article\" tabindex=\"-1\" id=\"articlereader\" data-show-title=\"false\" data-theme=\"wsj-article-reader\" data-show-header=\"false\" data-show-subscribe=\"false\" data-ads-enabled=\"true\" data-save-publication=\"false\">\n        <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       Shares of Robinhood Markets Inc. are rising Monday after picking up a handful of new fans on Wall Street who praised the company\u2019s unique positioning. <\/p>\n<p> At least eight Wall Street analysts initiated coverage of Robinhood\u2019s stock<br \/>\n        HOOD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/228268942\/composite\" class=\"positive\">+0.02%<\/bg-quote><br \/>\n       Monday, based on FactSet data and MarketWatch\u2019s analysis. Half of them assigned the equivalent of buy ratings. Shares are up 5.1% in afternoon trading Monday. <\/p>\n<p><strong>Don\u2019t miss: Robinhood earnings show a company reliant on quieting retail traders and volatile crypto pricing<\/strong><\/p>\n<div class=\"paywall\">\n       Even the most bullish analysts acknowledged that Robinhood is a controversial story, but many were willing to look beyond current debates over things like the company\u2019s options mix and the practice of payment for order flow, as they instead focused on the company\u2019s opportunity to grow beyond stock trading into banking and other financial \u201csuper-<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>\u201d functions. <\/p>\n<p>\u201cWith its 22.5 million active users and fetching 50% of all new retail U.S. accounts, we view\u00a0Robinhood\u00a0not as a meme stock phenomenon, but as a singularity that captures Generation Z\u2019s zeitgeist,\u201d Mizuho analyst Dan Dolev wrote in a note to clients. <\/p>\n<p>Dolev\u2019s research indicated that Robinhood\u2019s exposure to options is \u201cless dramatic than feared,\u201d a point that he suggested should address investor concerns over whether Robinhood\u2019s user base \u201cis \u2018betting\u2019 more than it is \u2018investing.&#8217;\u201d He also argued that the company is less exposed to meme stocks and \u201chomogenous\u201d trading trends than some investors may fear. <\/p>\n<p>\u201cOffering a single app with features such as banking, debit, credit and other features is the key future opportunity for Robinhood in our view,\u201d he continued. The total addressable markets for bank accounts in the U.S. is perhaps 500 million accounts, suggesting to him that Robinhood currently only serves less than 5% of its possible customer base. <\/p>\n<p>Adding new products and services could help Robinhood more than double its average revenue per user over time, according to Dolev, who initiated coverage with a buy rating and $68 price target. <\/p>\n<p>Rosenblatt Securities analyst Sean Horgan also wrote that investors seemed to be misunderstanding the Robinhood story. \u201cNet\/net, we believe viewing Robinhood in the context of the legacy e-brokers lacks completeness and overlooks the opportunity it has to capture a large share of primary bank accounts in the U.S.,\u201d he wrote. <\/p>\n<p>Horgan added that \u201cthe scale tilts overwhelmingly bullish for us\u201d as he evaluates Robinhood\u2019s opportunities. He and his team \u201cappreciate the merits of the bear case (in particular the headwinds of declining industry trading volumes),\u201d but are upbeat about Robinhood\u2019s potential to capture a meaningful sliver of the $140 billion in consumer banking revenues in the U.S. <\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>Horgan compared the company to a number of hot names in the tech world. Like Apple Inc.<br \/>\n        AAPL,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202934861\/composite\" class=\"positive\">+0.72%<\/bg-quote><span>,<\/span><br \/>\n       Robinhood has a valuable user interface as its \u201cno-frills, intuitive, and un-intimidating platform\u201d makes it easy for first-time investors to jump into trading. And like Square Inc.<br \/>\n        SQ,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/205989440\/composite\" class=\"positive\">+2.24%<\/bg-quote><span>,<\/span><br \/>\n       the company has a \u201chighly engaged\u201d base of users trying out \u201chigh-touch products like stock\/crypto trading\u201d that Robinhood could eventually translate into new monetization opportunities. <\/p>\n<p>The company has already rolled out a Cash Management feature that gives users Robinhood debit cards. Square offers a \u201cplaybook\u201d there as the fintech company has seen success with its Cash Card debit card, Horgan said. He began coverage of Robinhood\u2019s stock with a buy rating and $55 target. <\/p>\n<p><strong>See also: Why did Visa just buy a \u2018CryptoPunk\u2019 NFT for $150,000? The payments giant wants \u2018a seat at the table as the crypto economy evolves\u2019<\/strong><\/p>\n<p>JMP Securities analyst Devin Ryan took a similar view. \u201cRobinhood is clearly most well-known for its trading platform, in some ways becoming synonymous with millennial trading, but its bigger vision is to democratize access to financial services internationally well beyond just investing, and to become one of the world\u2019s leading \u2018single money apps,&#8217;\u201d he wrote. <\/p>\n<p>While other companies also aim to deliver a unified app for various elements of financial services, Robinhood has key advantages, according to Ryan. <\/p>\n<p>\u201cRobinhood has scaled materially more than most, it is vertically integrated within a number of areas that allow it to control its own destiny (vs. being dependent on decisions and viability of third-party relationships), and it controls a greater portion of the economic stream within each business, which can be used to drive better pricing for customers, invest in other parts of the business model, or create a better financial outcome for other stakeholders,\u201d he continued. <\/p>\n<p>Ryan set a market outperform rating and $58 target on the shares. <\/p>\n<p>Though Barclays analyst Ross Sandler also cheered Robinhood\u2019s opportunity as it chases the \u201csuper-app\u201d vision, he wasn\u2019t ready to jump on the bull train. His equal-weight rating reflected \u201clack of confidence in the projections and regulatory uncertainty.\u201d <\/p>\n<p>Sandler noted that \u201cthe vast majority of HOOD revenue is derived from the much-scrutinized practice of payment for order flow\u201d and explained that \u201csimplistically, PFOF revenue is generated when brokers like HOOD receive fees for directing trades to a market maker instead of directly to the exchange.\u201d<\/p>\n<p>Amid regulatory scrutiny of PFOF, Sandler doesn\u2019t think that it will disappear \u201cin the im<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>te term\u201d but views it as \u201cdefinitely a risk to monitor.\u201d Additionally, he commented that within Robinhood\u2019s PFOF revenue stream, three companies make up a high revenue concentration. <\/p>\n<p>\u201cWhile on one hand it\u2019s fair to assume that these relationships are mutually beneficial, on the other hand, its concerning that these three entities comprise such a large portion of HOOD revenue \u2013 and are comprising an even greater concentration risk over time,\u201d Sandler wrote.<\/p>\n<p>The stock has gained 28.7% since it closed at $34.82 on its first day of trading on July 29, while bitcoin has advanced 24.0%<br \/>\n        BTCUSD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/31322028\/realtime\" class=\"negative\">-1.72%<\/bg-quote><br \/>\n       the S&amp;P 500 index<br \/>\n        SPX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210599714\/realtime\" class=\"positive\">+0.88%<\/bg-quote><br \/>\n       has gained 1.5% over the same time.<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>    <span>By<\/span><\/p>\n<div class=\"author mobile-scrim hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Emily Bary\",\"subhead\":\"The Wall Street Journal\",\"list\":[{\"type\":\"link\",\"icon\":\"bio\",\"url\":\"https:\/\/marketwatch.com\/author\/emily-bary\",\"text\":\"Biography\"},{\"type\":\"link\",\"icon\":\"twitter\",\"url\":\"https:\/\/twitter.com\/emilybary\",\"text\":\"@emilybary\"},{\"type\":\"link\",\"icon\":\"email\",\"url\":\"http:\/\/www.marketwatch.com\/news\/mailto:ebary@marketwatch.com\",\"text\":\"ebary@marketwatch.com\"}]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n                <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/marketwatch.com\/author\/emily-bary\"><\/p>\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Emily_Bary\"><\/span>Emily Bary<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><\/a>\n          <\/div>\n<\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B20C05575-04D4-B545-75DC-964448FB214E%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;#The Ratings Game: Why Robinhood may be more than a \u2018meme stock phenomenon\u2019&#8221; Analysts like the company\u2019s opportunities in banking and beyond Shares of Robinhood Markets Inc. are rising Monday after picking up a handful of new fans on Wall Street who praised the company\u2019s unique positioning. At least eight Wall Street analysts initiated coverage&#8230;<\/p>\n","protected":false},"author":1,"featured_media":331826,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-331825","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/331825","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=331825"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/331825\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/331826"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=331825"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=331825"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=331825"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}