Morgan Stanley Boosts Robinhood Price Target to $150 Amid Growing Asset-Based Revenues
Morgan Stanley upgraded Robinhood Markets to 'Overweight' from 'Equal-weight', raising its price target to $150. The upgrade comes despite broader cryptocurrency-related stocks declining, with Coinbase and Strategy trading lower.
The bank cited Robinhood's expanding product lineup, stronger customer engagement, and growing asset-based revenues as key growth drivers. Morgan Stanley also raised its earnings estimates for the company through 2028, expecting a 23% compound annual growth rate through 2028, reaching $8 billion in revenue.
The upgrade was driven by Robinhood's ability to generate more revenue from its existing customer base rather than relying primarily on growth in funded accounts. The company now has 13 business lines generating over $100 million in annualized revenue, and event contract revenue increased to $156 million in the second quarter, surpassing revenue generated from equities and cryptocurrency trading.
Morgan Stanley's analysts noted that fewer than 2 million prediction-market users generated the $156 million in second-quarter revenue, highlighting the potential for further customer engagement. The bank also sees greater monetization opportunities as Robinhood expands further into market infrastructure.