A bullish analyst note was the spark that lit the fire under Robinhood Markets (HOOD +2.85%) on Tuesday. Inspired by the update, investors snapped up shares of the next-generation brokerage, and they were trading up by more than 2% in mid-session action.
Predicting future success
The note was authored by Mizuho's Dan Dolev, In the analysis, Dolev reiterated his outperform (i.e., buy) recommendation and $172 per share price target on Robinhood's equity.
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According to reports, Dolev focused on prediction markets, a lucrative segment of the financial industry that has been very lively of late.
The pundit wrote that, compared to cryptocurrency brokerage Coinbase, the fresh money -- i.e., a client's capital earmarked specifically for prediction markets, rather than reallocated from existing investments -- proportion for Robinhood is larger, at around 50%.
Dolev estimated that Robinhood's run rate from prediction markets is $300 million, a figure that inspired him to raise both 2026 and 2027 revenue forecasts by 6% to 7%.
NASDAQ: HOOD
Key Data Points
An adventurous brokerage
Robinhood is a very ambitious company, and it is clearly eager to expand into new segments -- it eagerly embraced crypto before it was commonplace, and it has already managed to build a healthy business with its prediction market operations.
It has already demonstrated a knack for extracting value from such explorations, and I think it'll continue to do so. I'm bullish on Robinhood's future, too, and I feel it's an important company well worth watching in the financial sector.
