It's been a good year for a lot of traders on online investing app Robinhood. The commission-free platform continuously updates its list of the top 100 investments among its members, providing the market with insight as to where their money is going.
Given Robinhood's relatively young audience -- the average user age is just 31 -- it's not a surprise to see a lot of low-priced stocks and tech companies among the most widely held investments. There's no shortage of "fun" stocks like cruise lines and gaming specialists. There are also disruptors and electric vehicle plays in the mix. There are even a few blue chips.
Let's look at some of the more intriguing names on this list of stocks that Robinhood investors can't seem to get enough of these days.
Dave & Buster's
There are only two restaurant stocks among the 100 most popular investments on Robinhood. Starbucks isn't a surprise. Everyone loves good coffee. The other name -- Dave & Buster's Entertainment (PLAY -0.71%) -- is proof that Robinhood users like a little arcade fun with their grub.
Dave & Buster's runs a chain of big-box stores that combine casual dining and high-tech gaming under the same roof. All of its locations closed down in the wake of the COVID-19 pandemic. The reopening process has been taxing. Just 104 of its 139 locations were open by the end of the fiscal third quarter that ended on Nov. 1. It had to pare back operations at some of those reopened units as the COVID-19 case counts began to spike in recent weeks.
Dave & Buster's investors are looking ahead. The shares have soared sixfold since bottoming out in March, even as the company struggles financially. Revenue declined 64% in its latest quarter, weighed down by a brutal 66% plunge in comps. Business is gradually getting better. By late October, sales were up to 68% of the prior year's level. By the end of October, 80 of the 104 reopened stores were generating positive store-level EBITDA. The current quarter will be challenging given the hit operations took from the uptick in COVID-19 cases. Still, Dave & Buster's has proven that it has the right ingredients to bounce back at the other end of this pandemic and economic lull.
It didn't take long for one of this month's hottest IPO stocks to light up the Robinhood Top 100. Airbnb (ABNB 0.74%) has been public for less than three weeks, but Robinhood traders aren't going to shy away from that new stock smell.
The leading peer-to-peer platform, which allows folks to rent out their homes or spare rooms to travelers, hit the market at $68. The stock has more than doubled, closing at exactly $150 on Tuesday.
Airbnb is another company seeing its business model temporarily disrupted in the new normal. Revenue growth has declined 32% through the first nine months of the year. It had clocked in with top-line upticks of 43% and 32% in 2018 and 2019, respectively. Airbnb's market cap may already be approaching $100 billion, but the excitement is understandable. When we start to travel again, we're probably going to stay away from crowded hotels. Airbnb will shine by offering unique and potentially safer accommodations.
Satellite radio provider Sirius XM Holdings (SIRI -1.06%) seems to check off many of Robinhood investors' boxes. It's a low-priced stock. It's a household name. There are probably many Howard Stern fans among Robinhood users, and they might be drawn to Sirius XM's stock even more now that the legendary morning show host has extended his deal by another five years.
In other respects, Sirius XM doesn't fit the typical Robinhood profile. It's not a fast-growing company. This will be its sixth consecutive year of organic top-line growth. The media stock also pays a quarterly dividend that it has boosted every year since initiating a payout policy in 2016. Every investor can use a steady grower and healthy trickle of investment income.