HOOD Stock Forecast as Analysts Slash Robinhood Targets Amid Crypto Winter

HOOD stock has retreated sharply in the past few weeks, moving from last month’s high of $119.8 to the current $92.80. This retreat happened even as the company published some encouraging financial results. It was trading at $92.80 on Thursday, down by over 22% from its highest point this year.

Analysts Have Slashed Their HOOD Stock Forecast

Top Wall Street analysts tracking Robinhood have slashed their target for the company, citing its valuation and the ongoing crypto winter. This downgrade happened after the recent earnings, which showed that its crypto business slowed.

Cantor Fitzgerald’s Ramsey El-Assal lowered his target from $130 to $115. Similarly, Loop Capital lowered the target to $115, while Barclays’ Benjamin Budish slashed the target from $122 to $105.

Similarly, James Yaro, a top analyst from Goldman Sachs, slashed the target from $137 to $118. As a result, the consensus target for analysts is $120, which is up by about 30% from the current level.

A key concern among analysts is that its crypto business continued to weaken in the first quarter. Its transaction revenue came in at $100 million, down by 38% from the same period last year. This happened because Bitcoin and most altcoins tumbled into bear markets in the past few months. Transaction volume normally drops whenever Bitcoin and most altcoins are under pressure.

Sadly, there are signs that the industry will take longer to recover. Bitcoin is recoiling at $63,000, while Ethereum and XRP have remained in a narrow range. Until a new crypto market rally emerges, chances are that volume in the industry will remain under pressure in the next few quarters.

Robinhood is Growing in Other Areas

On the positive side, the most recent results showed that Robinhood’s business was growing in other areas. For example, despite the crypto winter, Robinhood Chain continued growing after its launch. The platform’s total value locked (TVL) jumped to a record high of $435 million, while its DEX volume has soared. Protocols in the network have handled transactions worth over $11 billion.

Robinhood aims for this chain to be a major player in key industries like real-world asset (RWA) tokenization and stablecoins. In the future, the developers hope that it will be the most important chain in the crypto industry.

The results showed that Robinhood is also becoming a giant in the prediction market, with the number of contracts jumping to 6.4 billion in the quarter from 3.9 billion in the previous quarter. Also, the number of traded options soared to 318 million from 231 million in the previous one.

Another positive is that the company is expected to keep growing in the near term. The expected revenue growth for this year is expected to be 15% to $5.15 billion. After that, analysts expect it to grow by 25% next year to $6.47 billion.

Robinhood’s key benefit compared to other companies is its strong market share among young people. It is also a highly innovative company, that has continued to add more services in the past few years.

HOOD Stock Price Technical Analysis

The daily chart shows that HOOD’s stock price has recently dropped, moving from a high of $119.87 to a low of $83.75. A closer look shows that the stock has formed a giant broadening wedge pattern, which is also known as a megaphone. It is now on the lower side of the pattern, while the Relative Strength Index (RSI) has pointed upwards.

Therefore, there is a likelihood that the stock will continue to rise, potentially reaching the year-to-date high of $119.87, which aligns with the consensus analyst target.