Robinhood Markets Inc (NASDAQ:HOOD) has been upgraded to a 'buy' from 'neutral' by Goldman Sachs, which sees the trading platform becoming a best-in-class service for all ages.
“In our view, HOOD has successfully migrated from a fast-growing, periodically profitable online broker servicing mostly younger investors, to a best-in-class top and bottom-line asset under custody compounder with a growing total addressable market (TAM). “
Growth will be driven by “continued wallet share gains” among highly profitable active traders, added the US bank, with a long-term opportunity to expand into new areas such as wealth and internationally.
Shares have been stellar performers this year already notes the Wall St giant, rising by 205% helped by a stream of earnings upgrades and comfortably ahead of rivals.
Goldman Sachs’ target of US$46 however implies 19% further upside based on its earnings forecasts, but the bank concedes these might be too conservative.
Shares were down 5% overnight at US$39.54.