Robinhood's Record Quarter Leaves Analysts Cutting Price Targets

Robinhood reported its best quarter ever, beating every estimate and delivering record revenue, margins, and earnings per share.

The company's stock price should have gone up, but instead Wall Street analysts cut their price targets. Barclays cut from $122 to $105, Goldman cut from $137 to $118, and Needham cut from $123 to $120, all while keeping their buy ratings.

This suggests that the multiple doing the work is the main factor in the stock's performance. On June 30, the stock closed at $100.28 against $2.07 of trailing earnings per share, so investors paid about 48x earnings. It's now near $90 against $2.27, so they pay under 40x earnings.

Robinhood's revenue grew 32% to $1.31 billion, with adjusted EBITDA up 35% at a 57% margin. Options grew 29% to $342 million, equities revenue grew 95% to $129 million, and event contracts did $156 million in revenue.

However, crypto revenue fell 38% to $100 million while the quarter overall was still a record. The company now runs 13 separate businesses doing $100 million or more in annualized revenue.