Robinhood Markets Hits 52-Week High: Should You Buy the Stock Now?

Robinhood Markets, Inc. HOOD touched a 52-week high of $68.20 during yesterday’s trading session. Over the past three months, the stock has gained 47.1%, outperforming the industry, the Zacks Finance Sector, the S&P 500 index and its close peers — The Charles Schwab Corporation SCHW and LPL Financial Holdings Inc. LPLA.

3 Months' Price Performance

Does the HOOD stock have more upside left despite hitting a 52-week high? Let us find out.

Factors Likely to Drive Robinhood Stock

Volatility Amid Tariff Policy Concerns to Drive Revenues: On Feb. 13, President Donald Trump announced a plan for “reciprocal” tariffs to reduce the fiscal trade deficit. This move brought concerns regarding potential tariff wars, leading to higher market volatility.

Though the situation has pacified to some extent in light of a pause on tariffs as countries negotiate, the uncertainty concerns continue to linger surrounding the impact of tariff policies. This is expected to contribute to the increase in Robinhood’s transaction-based revenues, due to heightened volatility and increased market participation.

Robinhood’s total net revenues have witnessed a compound annual growth rate (CAGR) of 60.4% over the past five years (2019-2024), with transaction-based revenues recording a CAGR of 57.3%. The momentum continued for both metrics in the first quarter of 2025. Given the company’s focus on transaction-based revenues combined with the commission-free model and ongoing volatility in the markets, its revenues are likely to move higher.

Total Revenue Segregation

Further, the Trump administration has been favorable to cryptocurrency as regulators have been easing norms and regulations for firms to venture into digital assets. Moreover, in March 2025, Trump signed an executive order to establish a strategic crypto reserve. This will likely support Robinhood’s cryptocurrency revenues as new investors will be attracted to cryptocurrencies to boost their returns and leverage the benefit of diversification as an asset class as well.
 
In the first three months of 2025, the company’s cryptocurrency revenues were $252 million, constituting 27.2% of total net revenues. Over five years (2019-2024), the metric witnessed a CAGR of 140.3%.

Transaction-Based Revenues Components

Robinhood acquired Bitstamp yesterday. Bitstamp's core spot exchange, which features more than 85 tradable assets, coupled with its popularity in Europe and Asia, will significantly enhance Robinhood’s crypto offerings.

Also, in May 2025, Robinhood agreed to acquire WonderFi, a leader in digital asset products and services in Canada. This move aims to capitalize on rising crypto demand among Canada’s investors.

Currently, Robinhood offers trading in more than 30 cryptocurrencies on its app. 

Business Diversification Efforts: Robinhood became extremely popular among younger generations, riding on the meme stock wave in early 2021. Nonetheless, since its IPO in July 2021, the company has taken several steps to evolve from merely being a brokerage firm to a more mature and diversified entity, striving to become a one-stop shop for building generational wealth.
 
Last week, the company rolled out Robinhood Legend, a browser-based desktop trading platform, in the United Kingdom, after launching the same in the United States in October 2024.

In March 2025, Robinhood launched a prediction markets hub. Further, in the same month, the company launched Robinhood Strategies, Robinhood Banking and Robinhood Cortex, a suite of new features, to boost the wealth management offerings for its Robinhood Gold members. In January 2025, the company launched Futures, while in December 2024, it introduced the Tax Lots feature for investors.

In February 2025, Robinhood acquired TradePMR to expand into the registered investment advisers custody market. In July 2024, Robinhood acquired Pluto Capital Inc. With the integration of the latter’s advanced capabilities, the former is set to revolutionize the investment experience for its users.
 
Additionally, the company launched its first-ever credit card in March 2024.

Thus, rapid product innovations through vertical integration will likely expand HOOD’s client base, enabling greater operating leverage and paving the way for sustained profitability.

Similarly, in April 2025, Schwab introduced Alternative Investments Select, a new alternative investments platform, available to eligible retail clients having more than $5 million in household assets with the platform.

HOOD Rewards Shareholders: In April, Robinhood announced an additional share buyback plan worth $500 million. This plan supplemented the previous authorization of $1 billion announced in May 2024, extending the total authorization to $1.5 billion.

While the plan does not have an expiration date, the company expects to buy back shares within roughly two years. As of April 30, 2025, roughly $921 million worth of authorization remained available for repurchase.

Robinhood is on solid ground, with significant cash reserves. As of March 31, 2025, it reported cash and cash equivalents of $4.4 billion.

Bullish Analyst Sentiments

Over the past month, the Zacks Consensus Estimate for earnings of $1.22 and $1.47 per share for 2025 and 2026, respectively, moved 1.7% and 3.5% upward. The projected figures imply growth of 11.9% for 2025 and 20.5% for 2026.

Estimate Revision Trend

Robinhood’s Regulatory Headwinds

Robinhood operates in a highly regulated industry and falls under the scrutiny of numerous authorities. This exposes the company to regulatory risks, resulting in hefty fines and restrictions that may affect its profitability.
 
In March 2025, Robinhood’s units agreed to pay $26 million to settle Financial Industry Regulatory Authority allegations for failing to respond to red flags about potential misconduct and not verifying the identities of thousands of customers.

In January 2025, the company agreed to pay a $45 million fine for violating more than 10 securities law provisions. Previously, in September 2024, the company faced a $3.9 million penalty to settle crypto withdrawal failures. In 2023, the company faced defeat in proceedings at the Massachusetts Supreme Judicial Court regarding the supervision of product features and marketing strategies and paid a fine of $7.5 million.

These hefty fines have made investors cautious about Robinhood’s operations and the sufficient internal control procedures.

Likewise, in January 2025, LPL Financial agreed to pay a civil penalty of $18 million and implement improvements to its anti-money laundering (“AML”) policies and procedures. The Securities and Exchange Commission accused LPL Financial of numerous failures regarding its AML program.

Parting Thoughts on HOOD Stock

Solid revenue growth, organic and inorganic expansion initiatives to diversify the business and a strong balance sheet will aid Robinhood’s financials. Moreover, tariff policy concerns and easier regulations for digital asset businesses complement the company’s efforts to improve its top line through product diversification.
 
However, HOOD’s regulatory headwinds and rising operating expenses are major concerns. Further, foraying into the banking business amid intense competition keeps investors cautious about the company’s success.
  
Hence, investors should keep an eye on how Robinhood confronts the challenging backdrop. HOOD stock is a cautious bet for investors now. Those who already own it can hold for now for a robust long-term return.

HOOD currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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