Financial services platform Robinhood Markets (HOOD) will release its Fiscal Q3 financials on October 30. Wall Street analysts expect the company to report earnings per share of $0.18, a notable improvement from the $0.09 loss in the same quarter last year. Revenue is expected to reach $653 million, representing a 39% year-over-year increase, according to data from the TipRanks Forecast page.
In terms of HOOD’s earnings surprise history, we see that the company exceeded the consensus estimates in seven out of the previous nine quarters.
Encouraging Website Traffic Trend
Along with encouraging analysts’ estimates, HOOD’s website traffic data also suggests strong results for the company in the upcoming Q3 quarter. It should be noted that investors can use TipRanks’ Website Traffic Tool to gain insights into a company’s upcoming earnings report. The tool offers information on how a company’s website domain performed over a specific time frame.
For Robinhood Markets, TipRanks’ website traffic screener reveals that traffic increased sequentially as well as year-over-year in Q3. According to the tool, the number of visits to robinhood.com increased 121.12% from the year-ago quarter and 3.49% sequentially.
Insights from the TipRanks Bulls & Bears Tool
TipRanks’ Bulls Say, Bears Say tool provides insights into analysts’ views on Robinhood as it approaches its Q3 earnings report. Bulls are positive about the company following its launch of index options and futures, which are expected to attract more active traders. Further, they anticipate that Robinhood will achieve positive GAAP profit in FY24, driven by increased client activity in the equities and crypto bull market and effective cost management. Furthermore, analysts are optimistic about HOOD’s revenue growth, spurred by initiatives to attract more customers and boost user engagement across its offerings.
On the other hand, bearish arguments should not be overlooked. Bears warn that the expected interest rate cuts beginning in September 2024 may decrease net interest income, particularly from clients’ idle cash. Additionally, analysts express concerns about the long-term sustainability of HOOD’s growth as incentive payments start to wane.
Options Traders Anticipate a Large Move
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.
Indeed, it currently says that options traders are expecting a 10.01% move in either direction.
Is Robinhood Markets a Good Stock to Buy?
Turning to Wall Street, Robinhood stock has a Moderate Buy consensus rating. Out of the 17 analysts covering the stock, nine have a Buy recommendation, seven have a Hold, and one analyst recommends selling the stock. Furthermore, at $25.23, the average HOOD price target implies 9.51% downside potential. The shares of HOOD have gained 207% over the past year.
