Robinhood Markets Inc. (HOOD) stock edged more than 2% higher in the overnight trading session headed into Thursday, even as Cathie Wood's ARK Invest sold 89,915 shares worth approximately $7.5 million, according to a report from Investing.com. The sale occurred amid multiple positive developments for the online brokerage, including its newly secured IPO underwriter status, removal of the Pattern Day Trader rule, and strong May trading metrics showing platform assets reaching a record $377 billion. On Wednesday, Goldman Sachs analyst James Yaro raised the price target on Robinhood to $108 from $105 and maintained a 'Buy' rating after the company's May metrics update, according to TheFly. The developments come as Robinhood transitions from a distribution-focused platform into mainstream underwriting alongside major Wall Street banks.
ARK Invest Sells 89,915 Robinhood Shares Worth $7.5 Million
According to a report from Investing.com, ARK ETF sold 89,915 shares of Robinhood, valued at approximately $7.5 million. The sale comes despite a series of positive developments for the company that have boosted Wall Street confidence, although retail traders on Stocktwits remain 'bearish.'
Robinhood Secures IPO Underwriter Status and Posts Record May Metrics
Robinhood CEO Vlad Tenev said on Tuesday that Robinhood Securities had secured approval to serve as an IPO underwriter, marking its transition from a purely distribution role into mainstream underwriting alongside major Wall Street banks. "Since IPO Access launched in 2021, we've watched retail go from an afterthought to a key part of how companies plan an IPO," Tenev said in a post on X, adding that becoming an underwriter was the "natural next step" for Robinhood.
In May, the company posted strong monthly updates, noting that its total platform assets climbed to a record $377 billion at the end of the month, a 48% increase from a year earlier. The company's equity trading volume climbed 27% month-over-month and 75% year-over-year, while average daily equity trading volume surged 84% from a year ago. The brokerage firm also posted strong growth in options trading volume, event contracts, and margin balances.
The removal of the Pattern Day Trader (PDT) rule earlier this month eliminated the long-standing requirement for active traders to maintain at least $25,000 in their accounts to make frequent day trades.
Insider Meyer Malka Purchases 250,000 Shares for $20.2 Million
A regulatory filing from Tuesday revealed that Robinhood director and Ribbit Capital founder Meyer Malka purchased 250,000 shares of Robinhood for a total value of $20.2 million.
Goldman Sachs Raises Price Target to $108, Truist Maintains $100 Target
On Wednesday, Goldman Sachs analyst James Yaro raised the price target on Robinhood to $108 from $105 and maintained a 'Buy' rating on the shares after its May metrics update, according to TheFly.
Truist Securities reiterated a 'Buy' rating and $100 price target on Robinhood after the metrics update, noting that the company would likely see improvement in securities lending revenue from upcoming large IPOs, according to a report from Investing.com. The analyst said that with the stock trading in the $80s, it predicted a favorable risk-reward in the long term.
As per data from Koyfin, HOOD has a 12-month average price target of $100.36, indicating an upside potential of more than 16% from its last close of $86.36.
Retail Sentiment Turns Bearish on Stocktwits Despite Positive Catalysts
On Stocktwits, retail sentiment around HOOD declined from 'neutral' to 'bearish' territory over the past 24 hours as message volumes stayed 'high.' One user noted the various positive updates for the company, saying "surprised to see still below 100+." Another bullish user said, "Underwriting ipos is big news to me."
HOOD shares have lost 25% of their value so far this year.
FAQ
What did Robinhood announce on Tuesday regarding IPO underwriting?
Robinhood CEO Vlad Tenev said on Tuesday that Robinhood Securities had secured approval to serve as an IPO underwriter, marking its transition from a purely distribution role into mainstream underwriting alongside major Wall Street banks.
How much did Robinhood's equity trading volume increase in May?
In May, Robinhood's equity trading volume climbed 27% month-over-month and 75% year-over-year, while average daily equity trading volume surged 84% from a year ago.
What price target did Goldman Sachs set for Robinhood stock on Wednesday?
On Wednesday, Goldman Sachs analyst James Yaro raised the price target on Robinhood to $108 from $105 and maintained a 'Buy' rating on the shares after its May metrics update, according to TheFly.
